Alimentation Couche-Tard announces its results for the third quarter of fiscal 2012 Français

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Mar 13, 2012, 11:00 ET

For the quarter, diluted net earnings per share at $0.48 compared to $0.37 last year, an improvement of 29.7%. Diluted net earnings per share for the first three quarters are up 13.6%.
Same-store merchandise sales up 3.4% in the United States and 3.1% in Canada. In the United States, excluding tobacco products influenced by the deflationary effect of the price strategy of a cigarette manufacturer, the increase is 6.7%.
Consolidated merchandise and service gross margin up $20.4 million or 3.4%, posting at 32.9%, a decrease of 0.3%.
In the United States, same-store motor fuel volume up 1.1% and total volume up 14.0%, a clear improvement over the second quarter.
In Canada, total motor fuel volume up 4.6% taking into account new sites selling motor fuel but stable on a same-store basis, a clear improvement over the second quarter's same-store volume decrease of 3.0%.
Motor fuel gross margin in the United States stood at 14.84¢ per gallon compared to 13.12¢ per gallon for the corresponding period of the previous fiscal year. In Canada, motor fuel margin stood at CA5.19¢ per litre compared to CA5.66¢ per litre the previous year.
Excluding electronic payment fees and acquisition costs, operating expenses represented 30.2% of merchandise and service sales during the third quarter of fiscal 2012 compared to 30.8% during the third quarter of fiscal 2011. This ratio has improved consistently for the last 12 quarters.
During the quarter, signed a new agreement for a total of 20 company-operated stores.
Since the beginning of fiscal 2012, the Corporation has signed agreements for the acquisition of 227 company-operated stores, 243 stores operated by independent operators and 80 motor fuel supply agreements. 39 company-operated stores, 147 stores operated by independent operators as well as 17 motor fuel supply agreements had not yet been integrated into the network as of January 29, 2012.
Repurchase of 2,000 Class A multiple voting shares and 2,616,000 Class B subordinate voting shares.
Executed a new $1.0 billion credit agreement with an initial term of five years at exceptional conditions considering the current market conditions.

TSX: ATD.A, ATD.B

LAVAL, QC, March 13, 2012 /CNW Telbec/ - For its third quarter, Alimentation Couche-Tard Inc. announces net earnings of $86.8 million, up $17.2 million or 24.7% from the comparable period of the previous fiscal year. The increase is mainly attributable to the contribution from acquisitions, the increased contribution of merchandise and service sales and to the drop in financial expenses as well as to Couche-Tard's sound management of its expenses. These items have been partly offset by the growth in the depreciation and amortization expense as well as by acquisitions costs recorded to the quarterly earnings.

"We continued to favour a strategy focused on maintaining and increasing store traffic, which has really paid off this quarter", declared Alain Bouchard, President and Chief Executive Officer. "Thus, with some targeted promotions and continuous improvement of our fresh food offering, our same-store merchandise sales growth has accelerated during the quarter, which helped to increase the contribution of in-store sales. This good performance, combined with continuous monitoring of our costs, has enabled us to deliver very satisfactory results. Our teams continue to work hard on developing our fresh food offering and on the integration of stores, whether newly acquired or on the verge of being acquired, which suggests to me that great things are ahead for the coming quarters." he concluded.

As for Raymond Paré, Vice-President and Chief Financial Officer, he indicated: "The very satisfactory increase of 29.7% of diluted net earnings per share reflects the increased contribution of merchandise and services sales, our cost control for several years, proactive management of our balance sheet, redemption of shares and contribution from recent acquisitions. On this last point, we must remember that most acquired stores were only integrated into our network in the third quarter, making the 13.6% increase in year-to-date diluted net earnings per share even more meaningful, considering it has not yet fully benefited from the incremental contribution of acquisitions. In addition, many stores have yet to be integrated into our network over the coming quarters, which should contribute towards increasing our results in the medium term. We also continue to work on other acquisition opportunities. Thus, increasing value remains a priority for us and we use the various means at our disposal in a balanced manner as we have done for years".

Highlights of the Third Quarter of Fiscal 2012

Network growth
June 2011 Agreement with ExxonMobil
The following table summarizes progress made in relation to the acquisition agreement signed with ExxonMobil in June 2011 and the steps that still must be completed.

	During the 12-week period ended October 9, 2011	During the 16-week period ended January 29, 2012	During ther period between January 29, 2012 and March 13, 2012	Stores not yet integrated
Company-operated stores	1	73 ⁽¹⁾	-	-
Sites operated by independant operators (land leased by the Corporation and building owned by Corporation)	-	83	-	-
Sites operated by independant operators (real estate owned by the Corporation)	-	-	7	140 ⁽²⁾
Fuel supply agreements	63	-	3 ⁽³⁾	14 ⁽³⁾

(1)	Two of these sites were operated by independent operators at the time of the original agreement reached with ExxonMobil in June 2011.
(2)	Subject to ExxonMobil's obligation to submit a ''bona fide'' offer to the independent operators. Should the independent operator accept the offer, only fuel supply agreements would be transferred to Couche-Tard.
(3)	For these sites, the independent operators have accepted the ''bona fide'' offer ExxonMobil submitted them. Therefore, only the fuel supply agreements for the sites have been (will be) transferred.

Completed transactions
On October 13, 2011, Couche-Tard acquired from Chico Enterprises Inc., 26 company-operated stores operating in the northern part of West Virginia, United States, an area contiguous to Couche-Tard's operations in Ohio. The Corporation owns the real estate for 25 sites while it owns the building and leases the land for the other site.

On November 8, 9 and 10, 2011, through the RDK joint venture, Couche-Tard acquired from Supervalu Inc., 27 stores operating in the Chicago area, Illinois, United States. The agreement also includes the transfer to RDK of two vacant land parcels. Out of the 27 stores, 14 are company-operated while the other 13 are operated by independent operators. RDK owns the real estate for 24 sites as well as the two vacant land parcels while it leases the real estate for the three other sites.

On November 16 and 17, 2011, Couche-Tard acquired from ExxonMobil, 33 company-operated stores operating under the "On the Run" banner in Louisiana, United States. The Corporation owns the buildings for 33 sites as well as land for 25 sites while it leases the land for the other eight sites.

On December 12, 2011, Couche-Tard acquired from Neighbors Stores Inc., 11 company-operated stores operating under the "Neighbors" banner in North Carolina, United States. The Corporation owns the buildings for eight sites as well as the land for nine sites while it leases theses same assets for the other sites.

In addition, during the third quarter of fiscal 2012, Couche-Tard acquired six additional company-operated stores through distinct transactions for a cumulated total of 15 stores since the beginning of fiscal 2012.

Finally, during the quarter, Couche-Tard integrated into its network the two last stores acquired from Shell Canada Products during the first quarter of fiscal 2012.

Internal available cash and credit facilities were used for these acquisitions.

Outstanding transactions
In October 2011, Couche-Tard signed an agreement to acquire 17 company-operated stores operating in Maine, United States. Two stand-alone quick-service restaurant would also be transferred to the Corporation. Assuming the closing of the transaction which is now scheduled for April 2012, the Corporation would own the real estate for 16 sites while it would lease the other three sites. The transaction is subject to standard regulatory approvals and closing conditions.

In February 2012, Couche-Tard signed an agreement to acquire 20 company-operated stores operating in Texas, United States. Assuming the closing of the transaction which is scheduled for May 2012, the Corporation would lease the real estate for all sites. The transaction is subject to standard regulatory approvals and closing conditions.

Internal available cash and credit facilities should be used for these transactions.

Store construction
Couche-Tard completed the construction of four new stores during the 16-week period ended January 29, 2012 for a cumulated total of 16 stores since the beginning of fiscal 2012.

Changes in the Store Network
The following table presents certain information regarding changes in Couche-Tard's store network over the 16 and 40-week periods ended January 29, 2012⁽¹⁾:

		16-week period ended January 29, 2012			40-week period ended January 29, 2012
		Company- operated stores ⁽²⁾	Affiliated stores ⁽³⁾	Total	Company- operated stores ⁽²⁾	Affiliated stores ⁽³⁾	Total
Number of stores, beginning of period		4,382	1,333	5,715	4,401	1,394	5,795
	Acquisitions	158	-	158	179	-	179
	Openings / constructions / additions	12	13	25	23	34	57
	Closures / disposals / withdrawals	(30)	(51)	(81)	(81)	(133)	(214)
Number of stores, end of period		4,522	1,295	5,817	4,522	1,295	5,817
Stores for which real estate is controlled by Couche-Tard but that are operated by independent operators to which Couche-Tard supplies motor fuel through supply contracts							164
Stores to which Couche-Tard supplies motor fuel through supply contracts							174
Total number of stores in the Couche-Tard network							6,155

(1)	These figures include 50% of the stores operated through RDK.
(2)	Stores operated by the Corporation under one of Couche-Tard's main banners (Couche-Tard, Mac's, Circle K).
(3)	Stores operated by an independent operator through a franchise or similar agreement under one of Couche-Tard's main or secondary banners.

New credit agreement and reduction of previous credit agreements

On December 9, 2011, Couche-Tard entered into a new credit agreement consisting of a revolving unsecured facility of an initial maximum amount of $1.0 billion with an initial term of five years. The credit facility is available in the following form:

A term revolving unsecured operating credit, available i) in Canadian dollars, ii) in US dollars, iii) in the form of Canadian dollar bankers' acceptances, with stamping fees and iv) in the form of standby letters of credit not exceeding $100.0 million or the equivalent in Canadian dollars, with applicable fees. Depending on the form and the currency of the loan, the amounts borrowed bear interest at variable rates based on the Canadian prime rate, the bankers' acceptance rate, the US base rate or LIBOR plus a variable margin; and
An unsecured line of credit in the maximum amount of $50.0 million, available in Canadian or US dollars, bearing interest at variable rates based, depending on the form and currency of the loan, on the Canadian prime rate, the US prime rate or the US base rate plus a variable margin.

Standby fees, which vary based on a leverage ratio of the Corporation, apply to the unused portion of the credit facility. Stamping fees, standby letters of credit fees and the variable margin used to determine the interest rate applicable to amount borrowed are determined according to a leverage ratio of the Corporation.

Under the new credit agreement, Couche-Tard must maintain certain financial ratios and respect certain restrictive provisions.

Considering this new agreement, the amounts available under the previously existing credit agreements were adjusted as follows:

Operating credit A initial amount of $650.0 million was reduced to $326.0 million; and
Operating credit B initial amount of $310.0 million was reduced to $154.0 million.

The used portion of these facilities in excess of the reduced initial amounts was transferred to the new credit facility. The previous agreements remain in effect until September 22, 2012. All other conditions pertaining to the previous agreements remain unchanged.

Share repurchase program
Program which expired October 24, 2011
Couche-Tard had a share repurchase program which allowed it to repurchase up to 2,685,335 Class A multiple voting shares and up to 11,621,801 Class B subordinate voting shares. The program expired on October 24, 2011. The following table summarizes share repurchases made under this program.

	16-week period ended January 29, 2012		40-week period ended January 29, 2012		Since implementation of the program
	Number of shares repurchased	Weighted average cost per share	Number of shares repurchased	Weighted average cost per share	Number of shares repurchased	Weighted average cost per share
Class A multiple voting shares	1,000	CA$29.50	2,700	CA$29.44	14,700	CA$26.08
Class B subordinate voting shares	206,700	CA$29.28	4,559,900	CA$28.81	7,328,200	CA$27.40

Having made these repurchases, the number of Class A multiple voting shares and of Class B subordinate voting shares in circulation was reduced and the proportionate interest of all remaining shareholders in the Corporation's share capital was increased on a pro rata basis. All shares repurchased under the share repurchase program were cancelled upon repurchase.

Program effective October 25, 2011 expiring no later than October 24, 2012
The Corporation has a new share repurchase program which allows it to repurchase up to 2,684,420 of the 53,688,412 Class A multiple voting shares and up to 11,126,400 of the 111,264,009 Class B subordinate voting shares issued and outstanding as at October 11, 2011 (representing 5.0% of the Class A multiple voting shares issued and outstanding and 10.0% of the Class B subordinate voting shares of the public float, as at that date, respectively, as defined by applicable rules). In accordance with Toronto Stock Exchange requirements, the Corporation can repurchase a daily maximum of 1,000 Class A multiple voting shares and of 82,118 Class B subordinate voting shares. When making such repurchases, the number of Class A multiple voting shares and of Class B subordinate voting shares in circulation is reduced and the proportionate interest of all remaining shareholders in the Corporation's share capital is increased on a pro rata basis. The share repurchase period will end no later than October 24, 2012. All shares repurchased under the share repurchase program are cancelled upon repurchase. The following table summarizes share repurchases made under this program since its implementation.

	16-week period ended January 29, 2012		40-week period ended January 29, 2012		Since implementation of the program
	Number of shares repurchased	Weighted average cost per share	Number of shares repurchased	Weighted average cost per share	Number of shares repurchased	Weighted average cost per share
Class A multiple voting shares	1,000	CA$30.50	1,000	CA$30.50	1,000	CA$30.50
Class B subordinate voting shares	2,409,300	CA$30.19	2,409,300	CA$30.19	2,409,300	CA$30.19

Dividends
During its March 13, 2012 meeting, the Corporation's Board of Directors declared a quarterly dividend of CA$0.075 per share for the third quarter of fiscal 2012 to shareholders on record as at March 23, 2012, payable on April 6, 2012. This is an eligible dividend within the meaning of the Income Tax Act of Canada.

New member on the Board of Directors
Couche-Tard announces the nomination of Mrs. Nathalie Bourque as new member on the Board of Directors. She will also replace Mr. Richard Fortin as member on the Human resources and Corporate Governance committee. Mr. Fortin will remain a member of the Board of Directors. These changes will take effect on March 13, 2012. Mrs. Bourque is Vice President, Public Affairs and Global Communications at CAE Inc.

Exchange Rate Data
The Corporation's US dollar reporting provides more relevant information given the predominance of its operations in the United States and its debt largely dominated in US dollars.

The following table sets forth information about exchange rates based upon the Bank of Canada closing rates expressed as US dollars per CA$1.00:

	16-week periods ended		40-week periods ended
	January 29, 2012	January 30, 2011	January 29, 2012	January 30, 2011
Average for period ⁽¹⁾	0.9811	0.9921	1.0051	0.9750
Period end	0.9993	0.9989	0.9993	0.9989

⁽¹⁾ Calculated by taking the average of the closing exchange rates of each day in the applicable period.

Considering the Corporation uses the US dollar as its reporting currency, in its consolidated financial statements and in the present document, unless indicated otherwise, results from its Canadian and corporate operations are translated into US dollars using the average rate for the period. Variances and explanations related to variations in the foreign exchange rate and the volatility of the Canadian dollar which are discussed in the present document are therefore related to the translation in US dollars of the Corporation's Canadian and corporate operations results and do not have a true economic impact on its performance since most of the Corporation's consolidated revenues and expenses are received or denominated in the functional currency of the markets in which it does business. Accordingly, the sensitivity of the Corporation's results to variations in foreign exchange rates is economically limited.

Selected Consolidated Financial Information
The following table highlights certain information regarding Couche-Tard's operations for the 16 and 40-week periods ended January 29, 2012 and January 30, 2011:


(In millions of US dollars, unless otherwise stated)		16-week periods ended			40-week periods ended
		January 29, 2012	January 30, 2011	Variation %	January 29, 2012	January 30, 2011	Variation %
Statement of Operations Data:
Merchandise and service revenues ⁽¹⁾:
	United States	1,272.5	1,200.8	6.0	3,298.3	3,178.5	3.8
	Canada	595.4	585.0	1.8	1,685.3	1,602.2	5.2
	Total merchandise and service revenues	1,867.9	1,785.8	4.6	4,983.6	4,780.7	4.2
Motor fuel revenues:
	United States	3,969.0	3,047.7	30.2	9,901.7	7,439.0	33.1
	Canada	767.2	653.4	17.4	2,049.0	1,593.7	28.6
	Total motor fuel revenues	4,736.2	3,701.1	28.0	11,950.7	9,032.7	32.3
Total revenues		6,604.1	5,486.9	20.4	16,934.3	13,813.4	22.6
Merchandise and service gross profit ⁽¹⁾:
	United States	420.9	398.4	5.6	1,088.7	1,049.5	3.7
	Canada	193.2	195.3	(1.1)	563.4	552.3	2.0
	Total merchandise and service gross profit	614.1	593.7	3.4	1,652.1	1,601.8	3.1
Motor fuel gross profit:
	United States	171.4	138.1	24.1	473.1	424.0	11.6
	Canada	41.0	43.2	(5.1)	112.3	106.5	5.4
	Total motor fuel gross profit	212.4	181.3	17.2	585.4	530.5	10.3
Total gross profit		826.5	775.0	6.6	2,237.5	2,132.3	4.9
Operating, selling, administrative and general expenses		640.6	611.5	4.8	1,619.7	1,549.2	4.6
Depreciation and amortization of property and equipment and other assets		75.7	66.1	14.5	177.6	162.8	9.1
Operating income		110.2	97.4	13.1	440.2	420.3	4.7
Net earnings		86.8	69.6	24.7	339.8	304.7	11.5
Other Operating Data:
Merchandise and service gross margin ⁽¹⁾:
	Consolidated	32.9%	33.2%	(0.3)	33.2%	33.5%	(0.3)
	United States	33.1%	33.2%	(0.1)	33.0%	33.0%	0.0
	Canada	32.4%	33.4%	(1.0)	33.4%	34.5%	(1.1)
Growth of same-store merchandise revenues ^{(2) (3)}:
	United States	3.4%	3.9%		2.5%	4.4%
	Canada	3.1%	0.4%		2.1%	2.8%
Motor fuel gross margin ⁽³⁾:
	United States (cents per gallon):	14.84	13.12	13.1	16.99	15.98	6.3
	Canada (CA cents per litre)	5.19	5.66	(8.3)	5.41	5.48	(1.3)
Volume of motor fuel sold ⁽⁴⁾:
	United States (millions of gallons)	1,209.4	1,061.1	14.0	2,876.6	2,705.1	6.3
	Canada (millions of litres)	806.0	770.4	4.6	2,065.1	1,996.8	3.4
Growth of (decrease in) same-store motor fuel volume ⁽³⁾:
	United States	1.1%	0.7%		0.0%	0.8%
	Canada	0.0%	3.2%		(1.2%)	4.5%
Per Share Data:
	Basic net earnings per share (dollars per share)	0.49	0.38	28.9	1.88	1.65	13.9
	Diluted net earnings per share (dollars per share)	0.48	0.37	29.7	1.84	1.62	13.6

					January 29, 2012	April 24, 2011	Variation $
Balance Sheet Data:
	Total assets				4,184.4	3,926.0	258.4
	Interest-bearing debt				664.3	501.5	162.8
	Shareholders' equity				2,076.5	1,980.6	95.9
Indebtedness Ratios:
	Net interest-bearing debt/total capitalization ⁽⁵⁾				0.18 : 1	0.09 : 1
	Net interest-bearing debt/EBITDA ⁽⁶⁾				0.60 : 1 ⁽⁷⁾	0.26 : 1
	Adjusted net interest bearing debt/EBITDAR ⁽⁸⁾				2.30 : 1 ⁽⁷⁾	2.09 : 1
Returns:
	Return on equity ^{(7) (9)}				20.4 %	21.0 %
	Return on capital employed ^{(7) (10)}				17.9 %	18.1 %

(1)	Includes other revenues derived from franchise fees, royalties and rebates on some purchases by franchisees and licensees.
(2)	Does not include services and other revenues (as described in footnote 1 above). Growth in Canada is calculated based on Canadian dollars.
(3)	For company-operated stores only.
(4)	Includes volume of franchisees and dealers.
(5)	This ratio is presented for information purposes only and represents a measure of financial condition used especially in financial circles. It represents the following calculation: long-term interest-bearing debt, net of cash and cash equivalents and temporary investments, divided by the addition of shareholders' equity and long-term debt, net of cash and cash equivalents and temporary investments. It does not have a standardized meaning prescribed by IFRS and therefore may not be comparable to similar measures presented by other public corporations.
(6)	This ratio is presented for information purposes only and represents a measure of financial condition used especially in financial circles. It represents the following calculation: long-term interest-bearing debt, net of cash and cash equivalents and temporary investments, divided by EBITDA (Earnings Before Interest, Tax, Depreciation and Amortization). It does not have a standardized meaning prescribed by IFRS and therefore may not be comparable to similar measures presented by other public corporations.
(7)	This ratio was standardized over a period of one year. It includes the results of the first, second and third quarters of the fiscal year which will end April 29, 2012 as well as of the fourth quarter of the fiscal year ended April 24, 2011.
(8)	This ratio is presented for information purposes only and represents a measure of financial condition used especially in financial circles. It represents the following calculation: long-term interest-bearing debt plus the product of eight times rent expense, net of cash and cash equivalents and temporary investments, divided by EBITDAR (Earnings Before Interest, Tax, Depreciation, Amortization and Rent expense). It does not have a standardized meaning prescribed by IFRS and therefore may not be comparable to similar measures presented by other public corporations.
(9)	This ratio is presented for information purposes only and represents a measure of performance used especially in financial circles. It represents the following calculation: cumulated net earnings of the last four quarter divided by average equity for the same period. It does not have a standardized meaning prescribed by IFRS and therefore may not be comparable to similar measures presented by other public corporations.
(10)	This ratio is presented for information purposes only and represents a measure of performance used especially in financial circles. It represents the following calculation: cumulated earnings before income taxes and interests of the last four quarter divided by average capital employed for the same period. Capital employed represents total assets less short-term liabilities not bearing interests. It does not have a standardized meaning prescribed by IFRS and therefore may not be comparable to similar measures presented by other public corporations.

Operating Results

Revenues amounted to $6.6 billion in the third quarter of fiscal 2012, up $1.1 billion, an increase of 20.4%, mainly attributable to an increase in motor fuel sales due to higher average retail prices at the pump, to acquisitions, to the growth of same-store merchandise and service sales in the United States and Canada as well as the growth of same-store motor fuel volume in the United States. These items contributing to the growth in revenues were partially offset a weaker Canadian dollar.

For the first three quarters of fiscal 2012, revenues grew by $3.1 billion, an increase of 22.6% compared to the first three quarters of fiscal 2011.

More specifically, the growth of merchandise and service revenues for the third quarter of fiscal 2012 was $82.1 million or 4.6%, of which approximately $35.0 million was generated by acquisitions. As for internal growth, same-store merchandise revenues increased by 3.4% in the United States and 3.1% in Canada. For the Canadian and U.S. markets, the variance in same-store merchandise sales is attributable to Couche-Tard's merchandising strategies, to the economic condition in each of its markets as well as to the investments made to enhance service and the offering of products in its stores. In the United States, a cigarette manufacturer modified its supply terms and price structure, at the beginning of the first quarter of fiscal 2012, in order to encourage retailers to decrease or maintain low unit prices on certain of its products, which has put a deflationary pressure on cigarettes sales. Thus, Couche-Tard estimates that excluding tobacco products sales, its same-store merchandise sales in the United States increased by 6.7%. As for the weaker Canadian dollar, it had an unfavourable impact of approximately $6.0 million on merchandise and service revenues of the third quarter of fiscal 2012.

In the first three quarters of fiscal 2012, merchandise and service revenues rose by $202.9 million, a 4.2% increase compared to the same period last fiscal year for reasons similar to those of the third quarter, including an increase in same-store merchandise revenues of 2.5% in the United States and 2.1% in Canada. As for the stronger Canadian dollar, it had a favourable impact of approximately $49.0 million on the first three quarter of fiscal 2012 merchandise and service sales.

Motor fuel revenues increased by $1.0 billion or 28.0% in the third quarter of fiscal 2012, of which approximately $469.0 million stems from acquisitions. The still fragile economy and higher retail prices at the pump have continued to put pressure on motor fuel consumption, which can explain the stagnation of same-store motor fuel volume in Canada as well as the limited growth of 1.1% in the United States. The Corporation's performance in the United States is still satisfactory when compared with data from the U.S. Federal Highway Administration's October 2010, November 2010 and December 2011 Traffic Volume Trends reports which indicates that, month over month, travel on U.S. roads and streets declined by 2.3% compared to October 2010 and 0.9% compared to November 2010 while it increased by only 1.3% in December 2011 compared to December 2010.

The higher average retail price of motor fuel generated an increase in revenues of approximately $517.0 million as shown in the following table, starting with the fourth quarter of the fiscal year ended April 24, 2011:

Quarter		4^th	1^st	2^nd	3^rd	Weighted average
52-week period ended January 29, 2012
	United States (US dollars per gallon)	3.44	3.67	3.50	3.32	3.47
	Canada (CA cents per litre)	108.53	114.08	112.90	109.88	111.31
52-week period ended January 30, 2011
	United States (US dollars per gallon)	2.71	2.72	2.67	2.89	2.76
	Canada (CA cents per litre)	92.36	91.46	90.47	97.76	93.32

As for the weaker Canadian dollar, it had an unfavourable impact of approximately $7.0 million on motor fuel sales of the third quarter of fiscal 2012.

For the first three quarters of fiscal 2012, motor fuel revenues increased by $2.9 billion or 32.3% of which approximately $546.0 million were generated by acquisitions and $49.0 million by the appreciation of the Canadian dollar against its U.S. counterpart. Same-store motor fuel volume stayed unchanged in the United States while it dropped by 1.2% in Canada. The higher average retail price of motor fuel generated an increase in revenues of approximately $2.2 billion.

The consolidated merchandise and service gross margin grew by $20.4 million or 3.4% in the third quarter of fiscal 2012. The consolidated margin was 32.9%, a reduction of 0.3% compared with the same quarter of fiscal 2011. In the United States, the gross margin is down 0.1% to 33.1% while in Canada, it fell by 1.0% to 32.4%. This performance reflects changes in the product-mix, the improvements brought to supply terms as well as Couche-Tard's merchandising strategy in tune with market competitiveness and economic conditions within each of its market. More precisely, these margin reductions reflect more aggressive promotions in certain categories to protect store traffic as well as increases in the cost of certain products which Couche-Tard was not able to entirely and instantly pass to consumers considering current market conditions. However, in terms of absolute dollars, the increase in same-store merchandise sales more than offset the decrease in margin percent of these products, demonstrating that Couche-Tard's strategies paid off.

During the first three quarters of fiscal 2012, the consolidated merchandise and service gross margin grew by $50.3 million or 3.1%. The consolidated margin was 33.2%. More specifically, it was 33.0% in the United States, same as for the corresponding period of the previous fiscal year, and 33.4% in Canada, a decrease of 1.1%.

In the third quarter of fiscal 2012, the motor fuel gross margin for Couche-Tard's company-operated stores in the United States increased by 1.72¢ per gallon, from 13.12¢ per gallon last year to 14.84¢ per gallon this year. In Canada, the gross margin dropped to CA5.19¢ per litre compared with CA5.66¢ per litre for the third quarter of fiscal 2011. The motor fuel gross margin for Couche-Tard's company-operated stores in the United States as well as the impact of expenses related to electronic payment modes for the last eight quarters, starting with the fourth quarter of fiscal year ended April 24, 2011, were as follows:

(US cents per gallon)
Quarter		4^th	1^st	2^nd	3^rd	Weighted average
52-week period ended January 29, 2012
	Before deduction of expenses related to electronic payment modes	14.06	19.95	17.04	14.84	16.33
	Expenses related to electronic payment modes	4.93	5.29	5.20	4.74	5.02
	After deduction of expenses related to electronic payment modes	9.13	14.66	11.84	10.10	11.31
52-week period ended January 30, 2011
	Before deduction of expenses related to electronic payment modes	14.21	18.83	16.84	13.12	15.58
	Expenses related to electronic payment modes	4.14	4.15	4.16	4.36	4.21
	After deduction of expenses related to electronic payment modes	10.07	14.68	12.68	8.76	11.37

For the 40-week period ended January 29, 2012, the motor fuel gross margin for Couche-Tard's company-operated stores in the United States increased by 1.01¢ per gallon, from 15.98¢ per gallon last fiscal year to 16.99¢ per gallon this fiscal year. However, taking into account expenses related to electronic payment modes, net margin remained relatively stable. In Canada, the margin dropped slightly, reaching CA5.41¢ per litre compared with CA5.48¢ per litre for the first three quarters of fiscal 2011.

For the third quarter and first three quarters of fiscal 2012, operating, selling, administrative and general expenses rose by 4.8% and 4.6% respectively, compared with the third quarter and first three quarters of fiscal 2011, but increased by only 0.1% and 0.6% respectively, if we exclude certain items, as demonstrated by the following table:

		16-week period ended January 29, 2012	40-week period ended January 29, 2012
Total variance as reported		4.8%	4.6%
Subtract:
	Increase from incremental expenses related to stores acquired	3.1%	1.4%
	Increase from higher electronic payment fees	1.4%	2.1%
	Acquisition costs recognized to earnings of fiscal 2012	0.5%	0.3%
	(Decrease) increase from the strengthening (weakening) of the Canadian dollar	(0.3%)	0.9%
	Acquisition costs recognized to earnings of the comparable periods of fiscal 2011	-	(0.7%)
Remaining variance		0.1%	0.6%

The increase in electronic payment fees stems mainly from the rise in the average retail price of motor fuel. The remaining variance is due to additional expenses necessary to support growth in same-store merchandise sales as well as to the normal increase in costs due to inflation.

Moreover, excluding expenses related to electronic payment modes as well as acquisitions costs for both comparable periods, expenses in proportion to merchandise and services sales represented 30.2% of sales during the third quarter of fiscal 2012 (28.6% for the first three quarters of fiscal 2012), compared to 30.8% during the third quarter of fiscal 2011 (29.0% for the first three quarters of fiscal 2011). This indicator has been constantly improving for the last 12 quarters. This performance reflects Couche-Tard's constant efforts to find ways to improve its efficiency while ensuring that it maintains the quality of the service offered to clients.

During the third quarter of fiscal 2012, EBITDA increased by 15.3% compared to the corresponding period of the previous fiscal year, reaching $192.9 million. Acquisitions contributed $10.5 million to EBITDA, net of acquisition costs recorded to earnings while the exchange rate variation did not have a significant impact. As for the first three quarters of fiscal 2012, EBITDA increased by 6.5% compared to the corresponding period of the previous fiscal year, reaching $636.0 million. Acquisitions contributed $11.1 million to EBITDA, net of acquisitions costs recorded to earnings, while the strengthening of the Canadian dollar contributed for about $5.0 million.

It should be noted that EBITDA is not a performance measure defined by IFRS, but Couche-Tard, as well as investors and analysts, use this measure to evaluate the Corporation's financial and operating performance. Note that the Couche-Tard's definition of this measure may differ from the one used by other public corporations:

(in millions of US dollars)		16-week periods ended		40-week periods ended
		January 29, 2012	January 30, 2011	January 29, 2012	January 30, 2011
Net earnings, as reported		86.8	69.6	339.8	304.7
Add:
	Income taxes	26.4	20.4	109.8	102.9
	Net financial expenses	4.0	11.2	8.8	27.0
	Depreciation and amortization of property and equipment and other assets	75.7	66.1	177.6	162.8
EBITDA		192.9	167.3	636.0	597.4

For the third quarter and first three quarters of fiscal 2012, depreciation expense increased due to the investments made through acquisitions, replacement of equipment, addition of new stores and ongoing improvement of Couche-Tard's network. Since the second quarter of fiscal 2012, depreciation and amortization expense includes amortization of intangible assets related to the fuel supply contracts acquired from ExxonMobil.

For the third quarter and first three quarters of fiscal 2012, financial expenses decreased by $7.2 million and $18.2 million, respectively, compared to the corresponding periods of fiscal 2011, mainly because of the early redemption of the $350.0 million subordinated unsecured debt during the third quarter of fiscal 2011, which contributed to decrease the average interest rate on borrowings. Moreover, following the early redemption of the subordinated unsecured debt, Couche-Tard recorded a non-recurring charge of $3.0 million to fiscal year 2011 third quarter results. The reduction in financial expenses from the lower average interest rate was partially offset by the increase in the Corporation's indebtedness attributable to amounts disbursed for share repurchases and acquisitions.

The income tax rate for the third quarter of fiscal 2012 is 23.3% compared to a rate of 22.7% for the corresponding quarter of the previous fiscal year. For the first three quarters of fiscal 2012, the rate is 24.4% compared to a rate of 25.2% for the first three quarters of the previous fiscal year.

Couche-Tard closed the third quarter of fiscal 2012 with net earnings of $86.8 million, compared to $69.6 million the previous fiscal year, an increase of $17.2 million or 24.7%. Diluted net earnings per share stood at $0.48 compared to $0.37 the previous year, an increase of 29.7%. The exchange rate variation did not have a significant impact on net earnings of the third quarter of fiscal 2012.

For the first three quarters of fiscal 2012, net earnings were $339.8 million, compared to $304.7 million the previous fiscal year, an increase of $35.1 million or 11.5%. As for diluted net earnings per share, they stood at $1.84 compared to $1.62 the previous year, an increase of 13.6%. The stronger Canadian dollar had a favourable impact of approximately $3.9 million on net earnings.

Liquidity and Capital Resources
Notwithstanding the signature of a new credit agreement and the reductions to the previous credit agreements, Couche-Tard's sources of liquidity remain unchanged compared with the fiscal year ended April 24, 2011. For further information, please refer to Couche-Tard's 2011 Annual Report.

With respect to capital expenditures, acquisitions and share repurchases carried out by Couche-Tard in the first three quarters of fiscal 2012, they were financed using available cash. The Corporation expects that cash generated from operations together with borrowings available under its revolving unsecured credit facilities will be adequate to meet the Corporation's liquidity needs in the foreseeable future.

As at January 29, 2012, $647.9 million of the term revolving unsecured operating credits had been used ($589.0 million for the US dollars portion and $58.9 million for the Canadian dollars portion). As at the same date, the weighted average effective interest rate was 0.89% for the US dollars portion and 1.93% for the Canadian dollars portion. In addition, standby letters of credit in the amount of CA$1.5 million and $28.5 million were outstanding as at January 29, 2012.

As at January 29, 2012, $842.1 million were available under the credit agreements and Couche-Tard was in compliance with the restrictive covenants and ratios imposed by the credit agreements at that date. Thus, at the same date, the Corporation had access to more than $1.0 billion through its available cash and credit agreements.

Selected Consolidated Cash Flow Information


(In millions of US dollars)		16-week periods ended			40-week periods ended
		January 29, 2012	January 30, 2011	Variation	January 29, 2012	January 30, 2011	Variation
Operating activities		$	$	$	$	$	$
	Cash flows	130.2	141.5	(11.3)	482.9	461.8	21.1
	Other	(34.9)	(144.7)	109.8	(0.7)	(82.6)	81.9
Net cash provided by (used in) operating activities		95.3	(3.2)	98.5	482.2	379.2	103.0
Investing activities
	Business acquisitions	(312.5)	(8.1)	(304.4)	(350.3)	(34.3)	(316.0)
	Purchase of property and equipment and other assets, net of proceeds from the disposal of property and equipment and other assets	(85.6)	(68.6)	(17.0)	(189.8)	(133.5)	(56.3)
	Proceeds from sale and leaseback transactions	-	-	-	-	5.1	(5.1)
	Other	6.3	6.2	0.1	15.0	12.0	3.0
Net cash used in investing activities		(391.8)	(70.5)	(321.3)	(525.1)	(150.7)	(374.4)
Financing activities
	Net increase in borrowings	79.0	234.3	(155.3)	158.6	134.9	23.7
	Share repurchase	(78.0)	(60.2)	(17.8)	(201.2)	(60.2)	(141.0)
	Issuance of shares	16.8	4.8	12.0	19.2	10.0	9.2
	Dividends	(12.8)	(9.1)	(3.7)	(36.3)	(23.4)	(12.9)
	Early redemption of subordinated unsecured debt	-	(332.6)	332.6	-	(332.6)	332.6
Net cash provided by (used in) financing activities		5.0	(162.8)	167.8	(59.7)	(271.3)	211.6
Company credit rating
Standard and Poor's		BBB-	BB+		BBB-	BB+

Operating activities
During the third quarter of fiscal 2012, net cash from the operation of the Couche-Tard's stores reached $95.3 million, up $98.5 million compared to the third quarter of fiscal year 2011, mainly due to a more favourable change in working capital and to higher net earnings. During the first three quarters of 2012, net cash from operation of the Corporation's stores reached $482.2 million, up $103.0 million from the comparable period of fiscal 2011 for reasons similar as those provided for the third quarter.

Investing activities
During the third quarter of fiscal 2012, investing activities were primarily for the acquisition of 151¹ company-operated stores and 83¹ stores operated by independent operators (including related motor fuel supply agreements) for a total amount of $312.5 million and for net capital expenditures and other assets for an amount of $85.6 million. Since the beginning of the fiscal year, Couche-Tard acquired 170¹ company-operated stores, 83¹ stores operated by independent operators (including related motor fuel supply agreements) as well as 63 motor fuel supply agreements for a total amount of $350.3 million and disbursed a total of $189.8 million for net capital expenditures and other assets. Couche-Tard's capital investments were primarily for the replacement of equipment in some of its stores to enhance its offering of products and services, the addition of new stores as well as the ongoing improvement of its network.

Financing activities
During the third quarter of fiscal 2012, the increase in debt amounted to $79.0 million while Couche-Tard paid $78.0 million under its share repurchase program and $12.8 million in dividends. The Corporation also collected $16.8 million following issuance of shares upon exercise of stock options.

During the first three quarters of fiscal 2012, the increase in debt amounted to $158.6 million while Couche-Tard paid $201.2 million under its share repurchase program and $36.3 million in dividends. The Corporation also collected $19.2 million in cash following issuance of shares upon exercise of stock options.

____________________

¹ The number of stores differs from that presented in the "Changes in the Store Network" table because it excludes stores related to the RDK joint venture. The latter being accounted for using the equity method, the amount paid by RDK for its investing activities do not appear in Couche-Tard's investing activities.

Financial Position as at January 29, 2012
As shown by its indebtedness ratios included in the "Selected Consolidated Financial Information" section and net cash provided by operating activities, Couche-Tard's financial position is excellent. Couche-Tard's total consolidated assets amounted to $4.2 billion as at January 29, 2012, an increase of $258.4 million over the balance as at April 24, 2011. This increase stems primarily from the rise in property and equipment and goodwill resulting from the acquisitions made since the beginning of the fiscal year.

For the 52-week period ended January 29, 2012, Couche-Tard recorded a return on capital employed of 17.9%¹.

Shareholders' equity amounted to $2.1 billion as at January 29, 2012, up $95.9 million compared to April 24, 2011, mainly reflecting net earnings of the first three quarters of fiscal 2012, partially offset by shares repurchased, dividends declared and the decrease in accumulated other comprehensive income following the weakening of the Canadian dollar as at the balance sheet date. For the 52-week period ended January 29, 2012, the Corporation recorded a return on equity of 20.4%².

____________________

¹ This ratio is presented for information purposes only and represents a measure of performance used especially in financial circles. It represents the following calculation: cumulated earnings before income taxes and interests of the last four quarters divided by average capital employed for the same period. Capital employed represents total assets less short-term liabilities not bearing interests. It does not have a standardized meaning prescribed by IFRS and therefore may not be comparable to similar measures presented by other public corporations. This ratio was standardized over a period of one year. It includes the results of the first, second and third quarters of the fiscal year which will end April 29, 2012 as well as the fourth quarter of the fiscal year ended April 24, 2011.

² This ratio is presented for information purposes only and represents a measure of performance used especially in financial circles. It represents the following calculation: cumulated net earnings of the last four quarter divided by average equity for the same period. It does not have a standardized meaning prescribed by IFRS and therefore may not be comparable to similar measures presented by other public corporations. This ratio was standardized over a period of one year. It includes the results of the first, second and third quarters of the fiscal year which will end April 29, 2012 as well as the fourth quarter of the fiscal year ended April 24, 2011.

Selected Quarterly Financial Information (Unaudited)

(In millions of US dollars except for per share data, unaudited)		40-week period ended January 29, 2012			52-week period ended April 24, 2011				Extract from the 52-week period ended April 25, 2010⁽¹⁾
Quarter		3^rd	2^nd	1^st	4^th	3^rd	2^nd	1^st	4^th
Weeks		16 weeks	12 weeks	12 weeks	12 weeks	16 weeks	12 weeks	12 weeks	12 weeks
Revenues		6,604.1	5,152.6	5,177.6	4,737.0	5,486.9	4,149.1	4,177.4	4,003.5
Income before depreciation and amortization of property and equipment and other assets, share of earnings of a joint venture, financial expenses and income taxes		185.9	205.4	231.7	133.7	163.5	199.0	220.6	150.5
Depreciation and amortization of property and equipment and other assets		75.7	52.4	49.5	50.9	66.1	49.3	47.4	49.4
Operating income		110.2	153.0	182.2	82.8	97.4	149.7	173.2	101.1
Share of earnings of a joint venture accounted for using the equity method		7.0	5.2	6.0	2.6	3.8	4.8	5.7	-
Net financial expenses		4.0	2.1	2.7	2.6	11.2	8.2	7.6	7.4
Net earnings		86.8	113.5	139.5	64.5	69.6	108.2	126.9	68.8
Net earnings per share
	Basic	$ 0.49	$0.62	$0.76	$0.35	$0.38	$0.58	$0.68	$0.37
	Diluted	$ 0.48	$0.61	$0.75	$0.35	$0.37	$0.57	$0.67	$0.37

(1) Figures presented for this period were not restated following the adoption of IFRS.

Outlook
For the remainder of fiscal year 2012, Couche-Tard expects to pursue its investments with caution in order to, amongst other things, improve its network. Given the economic climate and the Corporation's attractive access to capital, it believes to be well-positioned to realize acquisitions and create value. However, Couche-Tard will continue to exercise patience in order to benefit from a fair acquisition price in view of current market conditions. It also intends to keep an ongoing focus on supply terms and operating expenses.

Couche-Tard also intends to focus its efforts to integrate into its network stores recently acquired or in process of being acquired.

Finally, in line with its business model, Couche-Tard intends to continue to focus its resources on the sale of fresh products and on innovation, including the introduction of new products and services, in order to satisfy the needs of its large clientele.

Profile
Alimentation Couche-Tard Inc. is the leader in the Canadian convenience store industry. In North America, Couche-Tard is the largest independent convenience store operator (whether integrated with a petroleum Corporation or not) in terms of number of company-operated stores. As of January 29, 2012, Couche-Tard had a network of 5,817 convenience stores, 4,225 of which include motor fuel dispensing. At the same date, the Corporation had agreements for the supply of motor fuel to 338 sites operated by independent operators. Couche-Tard's network consists of 13 business units, including nine in the United States covering 42 states and the District of Columbia, and four in Canada covering all ten provinces. More than 53,000 people are employed throughout Couche-Tard's retail convenience network and service centers.

The statements set forth in this press release, which describes Couche-Tard's objectives, projections, estimates, expectations or forecasts, may constitute forward-looking statements within the meaning of securities legislation. Positive or negative verbs such as "plan", "evaluate", "estimate", "believe" and other related expressions are used to identify such statements. Couche-Tard would like to point out that, by their very nature, forward-looking statements involve risks and uncertainties such that its results, or the measures it adopts, could differ materially from those indicated or underlying these statements, or could have an impact on the degree of realization of a particular projection. Major factors that may lead to a material difference between Couche-Tard's actual results and the projections or expectations set forth in the forward-looking statements include the effects of the integration of acquired businesses and the ability to achieve projected synergies, fluctuations in margins on motor fuel sales, competition in the convenience store and retail motor fuel industries, exchange rate variations, and such other risks as described in detail from time to time in the reports filed by Couche-Tard with securities authorities in Canada and the United States. Unless otherwise required by applicable securities laws, Couche-Tard disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. The forward-looking information in this release is based on information available as of the date of the release.

Webcast on March 13, 2012 at 3:30 P.M. (EST)

Couche-Tard invites analysts known to the Corporation to send their two questions in advance to its management, before 1:30 P.M. (EST) on March 13, 2012.

Financial analysts and investors who wish to listen to the webcast on Couche-Tard's results which will take place online on March 13, 2012 at 3:30 P.M. (EST) can do so by accessing the Corporation's website at www.couche-tard.com/corporate and by clicking on the corporate presentations link of the investor relations section. For those who will not be able to listen to the live presentation, the recording of the webcast will be available on the Corporation's website for a period of 90 days.

Q3 2012
ALIMENTATION COUCHE-TARD INC.
UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
16 and 40-week periods ended January 29, 2012

CONSOLIDATED STATEMENTS OF EARNINGS
(in millions of US dollars, except per share amounts, unaudited)

		16 weeks		40 weeks
For the periods ended		January 29,	January 30,	January 29,	January 30,
		2012	2011	2012	2011
		$	$	$	$
Revenues		6,604.1	5,486.9	16,934.3	13,813.4
Cost of sales		5,777.6	4,711.9	14,696.8	11,681.1
Gross profit		826.5	775.0	2,237.5	2,132.3

Operating, selling, administrative and general expenses		640.6	611.5	1,619.7	1,549.2
Depreciation and amortization of property and equipment and other assets		75.7	66.1	177.6	162.8
		716.3	677.6	1,797.3	1,712.0
Operating income		110.2	97.4	440.2	420.3
Share of earnings of a joint venture accounted for using the equity method		7.0	3.8	18.2	14.3

Financial expenses		4.3	20.7	9.9	38.2
Financial revenues		(0.3)	(9.5)	(1.1)	(11.2)
Net financial expenses		4.0	11.2	8.8	27.0
Earnings before income taxes		113.2	90.0	449.6	407.6
Income taxes		26.4	20.4	109.8	102.9
Net earnings		86.8	69.6	339.8	304.7

Net earnings per share (Note 6)
	Basic	0.49	0.38	1.88	1.65
	Diluted	0.48	0.37	1.84	1.62
Weighted average number of shares (in thousands)		177,731	184,486	180,866	185,025
Weighted average number of shares - diluted (in thousands)		181,259	188,210	184,364	188,569
Number of shares outstanding at end of period (in thousands)		178,979	183,682	178,979	183,682


CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(in millions of US dollars, unaudited)

For the periods ended		16 weeks		40 weeks
		January 29,	January 30,	January 29,	January 30,
		2012	2011	2012	2011
		$	$	$	$
Net earnings		86.8	69.6	339.8	304.7
Other comprehensive income
	Changes in cumulative translation adjustments ⁽¹⁾	23.2	3.0	(25.3)	0.8
	Change in fair value of a financial instrument designated as a cash flow hedge ⁽²⁾	0.3	1.0	1.6	2.3
	Gain realized on a financial instrument designated as a cash flow hedge transferred to earnings ⁽³⁾	(0.6)	(0.6)	(1.7)	(1.1)
	Change in fair value of an available-for-sale financial instrument ⁽⁴⁾	(0.3)	-	-	-
	Gain realized on the disposal of an available-for-sale financial instrument transferred to earnings ⁽⁵⁾	-	-	(0.6)	-
Other comprehensive income		22.6	3.4	(26.0)	2.0
Comprehensive income		109.4	73.0	313.8	306.7

	(1)	For the 16 and 40-week periods ended January 29, 2012, these amounts include a gain of $16.0 and a loss of $20.5, respectively (net of income taxes of $2.4 and $3.1, respectively). For the 16 and 40-week periods ended January 30, 2011, these amounts include a gain of $3.0 and a loss of $3.9, respectively (net of income taxes of $0.4 and $0.6, respectively). These gains and losses arise from the translation of US dollar denominated long-term debt designated as a foreign exchange hedge of the Corporation's net investment in its U.S. operations.
	(2)	For the 16 and 40-week periods ended January 29, 2012, these amounts are net of income taxes of $0.1 and $0.5, respectively. For the 16 and 40-week periods ended January 30, 2011, these amounts are net of income taxes of $0.3 and $0.8, respectively.
	(3)	For the 16 and 40-week periods ended January 29, 2012, these amounts are net of income taxes of $0.2 and $0.6, respectively. For the 16 and 40-week periods ended January 30, 2011, these amounts are net of income taxes of $0.2 and $0.4, respectively.
	(4)	For the 16-week period ended January 29, 2012, this amount is net of income taxes of $0.1.
	(5)	For the 40-week period ended January 29, 2012, this amount is net of income taxes.

The accompanying notes are an integral part of the consolidated financial statements.

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY

(in millions of US dollars, except per share amounts, unaudited)

For the 40-week period ended

January 29, 2012

Capital
stock

Contributed
surplus

Retained
earnings

Accumulated
other
comprehensive
income

Shareholders'
equity

Balance, beginning of period

323.8

19.3

1,596.3

41.2

1,980.6

Comprehensive income:

Net earnings

339.8

339.8

Change in cumulative translation adjustments

(25.3)

Change in fair value of a financial instrument designated
as a cash flow hedge (net of income taxes of $0.5)

1.6

Gain realized on a financial instrument designated as a cash
flow hedge transferred to earnings (net of income taxes of $0.6)

(1.7)

Gain realized on the disposal of an available-for-sale financial instrument
transferred to earnings (net of income taxes)

(0.6)

Total comprehensive income

313.8

Dividends

(36.3)

Stock option-based compensation expense

0.4

Initial fair value of stock options exercised

1.5

(1.5)

Cash received upon exercise of stock options

19.2

Repurchase and cancellation of shares

(23.9)

Excess of acquisition cost over book value of Class A multiple voting shares and Class B
subordinate voting shares repurchased and cancelled

(177.3)

Balance, end of period

320.6

18.2

1,722.5

15.2

2,076.5

For the 40-week period ended

January 30, 2011

Capital
stock

Contributed
surplus

Retained
earnings

Accumulated
other
comprehensive
income

Shareholders'
equity

Balance, beginning of period

319.5

20.4

1,319.7

0.4

1,660.0

Comprehensive income:

Net earnings

304.7

Change in cumulative translation adjustments

0.8

Change in fair value of a financial instrument designated as a
cash flow hedge (net of income taxes of $0.8)

2.3

Gain realized on a financial instrument designated as a cash flow
hedge transferred to earnings (net of income taxes of $0.4)

(1.1)

Total comprehensive income

306.7

Dividends

(23.4)

Stock option-based compensation expense

0.9

Initial fair value of stock options exercised

2.2

(2.2)

Cash received upon exercise of stock options

10.0

Repurchase and cancellation of shares

(8.2)

Excess of acquisition cost over book value of Class A multiple voting shares and Class B
subordinate voting shares repurchased and cancelled

(52.0)

Balance, end of period

323.5

19.1

1,549.0

2.4

1,894.0

The accompanying notes are an integral part of the consolidated financial statements.

CONSOLIDATED STATEMENTS OF CASH FLOWS
(in millions of US dollars, unaudited)

		16 weeks		40 weeks
For the periods ended		January 29,	January 30,	January 29,	January 30,
		2012	2011	2012	2011
		$	$	$	$
Operating activities
Net earnings		86.8	69.6	339.8	304.7
Adjustments to reconcile net earnings to net cash provided by operating activities
	Depreciation and amortization of property and equipment and other assets, net of amortization of deferred credits	63.8	60.2	148.3	143.9
	Deferred income taxes	(18.3)	26.2	1.4	35.5
	Gain on early redemption of subordinated unsecured debt	-	(1.4)	-	(1.4)
	Deemed interest on repayment of subordinated unsecured debt	-	(17.4)	-	(17.4)
	Loss on disposal of property and equipment and other assets	2.6	1.3	7.8	1.3
	Deferred credits	4.3	(0.2)	9.4	0.9
	Share of earnings (net of dividends) of a joint venture accounted for using the e quity method	(4.7)	3.0	(14.4)	(4.8)
	Other	2.4	8.4	15.7	18.7
	Changes in non-cash working capital	(41.6)	(152.9)	(25.8)	(102.2)
Net cash provided by (used in) operating activities		95.3	(3.2)	482.2	379.2

Investing activities
Business acquisitions (Note 5)		(312.5)	(8.1)	(350.3)	(34.3)
Purchase of property and equipment and other assets		(85.6)	(68.6)	(189.8)	(133.5)
Proceeds from disposal of property and equipment and other assets		6.3	6.2	15.1	12.0
Other		-	-	(0.1)	-
Proceeds from sale and leaseback transactions		-	-	-	5.1
Net cash used in investing activities		(391.8)	(70.5)	(525.1)	(150.7)

Financing activities
Net increase in other long-term debt		79.0	234.3	158.6	134.9
Repurchase of shares		(78.0)	(60.2)	(201.2)	(60.2)
Issuance of shares		16.8	4.8	19.2	10.0
Cash dividends paid		(12.8)	(9.1)	(36.3)	(23.4)
Early redemption of subordinated unsecured debt		-	(332.6)	-	(332.6)
Net cash provided by (used in) financing activities		5.0	(162.8)	(59.7)	(271.3)
Effect of exchange rate fluctuations on cash and cash equivalents		6.0	1.6	(4.1)	2.2
Net decrease in cash and cash equivalents		(285.5)	(234.9)	(106.7)	(40.6)
Cash and cash equivalents, beginning of period		488.5	410.0	309.7	215.7
Cash and cash equivalents, end of period		203.0	175.1	203.0	175.1

Supplemental information:
	Interest paid	2.4	16.0	5.1	31.3
	Interest received	0.3	0.1	1.1	1.0
	Income taxes paid	40.3	33.6	36.3	77.3

Cash and cash equivalents components:
	Cash and demand deposits			161.5	126.3
	Liquid investments			41.5	48.8
				203.0	175.1

The accompanying notes are an integral part of the consolidated financial statements.

CONSOLIDATED BALANCE SHEETS
(in millions of US dollars, unaudited)

		As at January 29,	As at April 24,	As at April 26,
		2012	2011	2010
		$	$	$
Assets
Current assets
	Cash and cash equivalents	203.0	309.7	215.7
	Accounts receivable	405.1	349.1	280.8
	Inventories	532.0	526.0	469.9
	Prepaid expenses	26.2	21.0	20.0
	Income taxes receivable	-	36.4	17.7
		1,166.3	1,242.2	1,004.1
Property and equipment		2,142.6	1,935.4	1,914.9
Goodwill		503.6	440.9	425.3
Intangible assets		221.6	188.6	188.2
Other assets		72.3	58.0	55.8
Investment in a joint venture		62.6	48.2	42.1
Deferred income taxes		15.4	12.7	8.6
		4,184.4	3,926.0	3,639.0

Liabilities
Current liabilities
	Accounts payable and accrued liabilities	866.9	936.5	821.7
	Provisions	47.8	36.3	31.4
	Income taxes payable	32.4	-	-
	Current portion of long-term debt	484.1	4.6	4.4
		1,431.2	977.4	857.5
Long-term debt		180.2	496.9	711.9
Provisions (Note 9)		104.9	88.7	87.7
Deferred credits and other liabilities		147.4	137.7	128.0
Deferred income taxes		244.2	244.7	193.9
		2,107.9	1,945.4	1,979.0

Shareholders' equity
Capital stock		320.6	323.8	319.5
Contributed surplus		18.2	19.3	20.4
Retained earnings		1,722.5	1,596.3	1 319.7
Accumulated other comprehensive income		15.2	41.2	0.4
		2,076.5	1,980.6	1,660.0
		4,184.4	3,926.0	3,639.0

The accompanying notes are an integral part of the consolidated financial statements.

NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(in millions of US dollars, except per share and stock option data, unaudited)

1. CONSOLIDATED FINANCIAL STATEMENTS PRESENTATION

The condensed unaudited interim consolidated financial statements ("the interim financial statements") have been prepared by the Corporation in accordance with Canadian generally accepted accounting principles as set out in the Handbook of the Canadian Institute of Chartered Accountants ("CICA Handbook"). In 2010, the CICA Handbook was revised to incorporate International Financial Reporting Standards ("IFRS"), and require publicly accountable enterprises to apply such standards effective for years beginning on or after January 1^st, 2011. Therefore, the Corporation started to present its information in accordance with these accounting standards in the interim financial statements for the 12-week period ended July 17, 2011 (Q1 2012). In these interim financial statements, the term "Canadian GAAP" refers to Canadian GAAP before the adoption of IFRS.

These interim financial statements were prepared in accordance with applicable IFRS for interim financial statements, including IAS 34 "Interim Financial Reporting" and IFRS 1 "First-time Adoption of International Financial Reporting Standards". In accordance with IFRS, the Corporation has:

provided comparative financial information;
applied the same accounting policies throughout all reporting periods presented (except for certain exemptions applicable for first time IFRS adopters applied and disclosed in Note 11); and
retrospectively applied all IFRS standards issued as of March 13, 2012, the date at which the board of directors approved the interim financial statements, with an effective date before April 29, 2012.

The Corporation's consolidated financial statements were previously prepared in accordance with Canadian GAAP. Canadian GAAP differs from IFRS in some areas. In preparing these interim financial statements in accordance with IFRS, management has amended certain accounting, measurement and consolidation methods previously applied in its financial statements prepared under Canadian GAAP. Note 11 presents line-by-line reconciliations of the balance sheets as at April 24, 2011 and April 26, 2010, a reconciliation of net earnings and comprehensive income for the fiscal year ended April 24, 2011, a reconciliation of shareholders' equity, net earnings and comprehensive income for the 16 and 40-week periods ended January 30, 2011, as well as a description of the effect of the transition from Canadian GAAP to IFRS on these items.

These interim financial statements have not been subject to a review engagement by the Corporation's external auditors. The interim financial statements were prepared in accordance with the same accounting policies and methods as the audited annual consolidated financial statements prepared in accordance with Canadian GAAP for the year ended April 24, 2011, except for those disclosed in Note 2. The interim financial statements do not include all the information required for complete financial statements and should be read in conjunction with the audited annual consolidated financial statements and notes thereto in the Corporation's 2011 Annual Report (the 2011 Annual Report). The results of operations for the interim periods presented do not necessarily reflect results expected for the full fiscal year. The Corporation's business follows a seasonal pattern. The busiest period is the first half-year of each fiscal year, which includes summer's sales.

On March 13, 2012, the Corporation's interim financial statements for the 16 and 40-week periods ended January 29, 2012 (including comparative statements) were approved by the board of directors which also approved their publication. Future changes to IFRS after that date will be applied to the annual consolidated financial statements for the fiscal year ended on April 29, 2012. Theses changes could result in a restatement of these interim financial statements, including adjustments to the transitory adjustments at the transition date.

2. ACCOUNTING POLICIES AFFECTED BY IFRS TRANSITION AND DIFFERENT FROM THOSE USED IN THE 2011 ANNUAL CONSOLIDATED FINANCIAL STATEMENTS

Principles of consolidation

The interim financial statements include the accounts of the Corporation and its subsidiaries, all of which are wholly owned. They also include the Corporation's portion of the earnings of a joint venture accounted for using the equity method. All intercompany balances and transactions have been eliminated on consolidation.

Subsidiaries are entities over which the Corporation has control, where control is defined as the power to govern financial and operating policies. The Corporation has a shareholding of 100% of the voting rights in its subsidiaries. The effect of potential voting rights that are currently exercisable is considered when assessing whether control exists. These criteria are reassessed regularly and subsidiaries are fully consolidated from the date control is transferred to the Corporation, and are deconsolidated from the date control ceases.

Foreign currency translation

Functional currency

The functional currency of the parent Corporation and its Canadian operations is the Canadian dollar while the US operations' is the US dollar.

Foreign currency transactions

Transactions denominated in foreign currencies are translated into the relevant functional currency as follows: Monetary assets and liabilities are translated at the exchange rate in effect at the balance sheet date and revenues and expenses are translated at the average exchange rate on a 4-week period basis. Non-monetary assets and liabilities are translated at historical rates or at the date they were valued at fair value. Gains and losses arising from such translation, if any, are reflected in the consolidated statement of earnings except when deferred in equity as qualifying net investment hedge.

Consolidation and foreign operations

The interim financial statements are consolidated in Canadian dollars using the following procedure: Assets and liabilities of the US operations are translated into Canadian dollars using the exchange rate in effect at the balance sheet date. Revenues and expenses are translated at the average exchange rate on a 4-week period basis. Gains and losses arising from such translation are included in Accumulated other comprehensive income account in Shareholders' equity.

Reporting currency

The Corporation has adopted the US dollar as its reporting currency. The Canadian dollar consolidated interim financial statements are translated into the reporting currency using the procedure described above. Capital stock, Contributed surplus and Retained earnings are translated using historical rates. Non-monetary assets at fair value are translated at the rate of the date at which their fair value was determined. Gains and losses arising from translation are included in Other comprehensive income in Shareholders' equity.

Net earnings per share

Basic net earnings per share is calculated by dividing the net earnings available to Class A and Class B shareholders by the weighted average number of Class A and Class B shares outstanding during the year. Diluted net earnings per share is calculated using the average weighted number of shares outstanding plus the weighted average number of shares that would be issued upon the conversion of all potential dilutive stock-options into common shares.

Income taxes

The income tax expense recorded to earnings is the sum of the deferred income tax and current income taxes that are not recognized in Other comprehensive income or directly to Shareholders' equity.

Income tax expense is recognized based on management's best estimate of the weighted average annual income tax rate expected for the fiscal year. The estimated weighted average annual tax rate used for the fiscal year ending on April 29, 2012 is 24.4% (25.2% for the 40-week period ended January 30, 2011).

The Corporation uses the balance sheet liability method to account for income taxes. Under this method, deferred tax assets and liabilities are determined based on differences between the carrying amounts and tax bases of assets and liabilities using enacted or substantively enacted tax rates and laws, as appropriate, at the date of the interim financial statements for the years in which the temporary differences are expected to reverse. A valuation allowance is recognized to the extent that it is more likely than not that all of the deferred income tax assets will not be realized.

Deferred tax liabilities are recognized for taxable temporary differences associated with investments in subsidiaries, and interests in joint ventures, except where the Corporation is able to control the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred tax assets arising from deductible temporary differences associated with such investments and interests are only recognized to the extent that it is probable that there will be sufficient taxable profits against which to utilize the benefits of the temporary differences and they are expected to reverse in the foreseeable future.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same taxation authority and the Corporation intends to settle its current tax assets and liabilities on a net basis.

Property and equipment, depreciation and amortization and impairment

Property and equipment are stated at cost less accumulated depreciation and are depreciated over their estimated useful lives using the straight-line method based on the following periods:

Buildings and building components		3 to 40 years
Equipment		3 to 40 years
Buildings under finance leases		Lease term
Equipment under finance leases		Lease term

Building components include air conditioning and heating systems, plumbing and electrical fixtures. Equipment includes signage, fuel equipment and in-store equipment.

Leasehold improvements and property and equipment on leased properties are amortized and depreciated over the lesser of their useful lives and the term of the lease.

Property and equipment are tested for impairment should events or circumstances indicate that their book value may not be recoverable, as measured by comparing their net book value to their recoverable amount which corresponds to the higher of fair value less costs to sell and value in use of the asset or cash-generating unit. Should the carrying amount of property and equipment exceed their recoverable amount, an impairment loss in the amount of the excess would be recognized.

The Corporation performs an annual evaluation of residual values, estimated useful lives and depreciation methods used for property and equipment and any change resulting from this evaluation is applied prospectively by the Corporation.

Goodwill

Goodwill is the excess of the cost of an acquired business over the fair value of underlying net assets acquired from the business at the time of acquisition. Goodwill is not amortized. Rather it is tested for impairment annually during the first quarter, or more frequently should events or changes in circumstances indicate that it might be impaired. Should the carrying amount of a cash-generating unit's goodwill exceed its recoverable amount, an impairment loss would be recognized. When the initial evaluation of the net fair value of the acquired assets of an acquired business exceeds the cost of the business combination, the excess is immediately recognized to earnings.

Intangible assets

Intangible assets are mainly comprised of trademarks and licenses. Trademarks and licenses have indefinite lives since they do not expire, are recorded at cost, are not amortized and are tested for impairment annually during the first quarter, or more frequently should events or changes in circumstances indicate that they might be impaired. Other intangible assets are amortized using the straight-line method over a period of five to ten years.

Rent expense

The Corporation accounts for finance leases in instances where it has acquired substantially all the benefits and risks incidental to ownership of the leased property. In some cases, the lease transaction is not always conclusive, and management uses judgment in determining whether the lease is a finance lease arrangement that transfers substantially all the risks and benefits incidental to ownership. The cost of assets under finance leases represents the present value of minimum lease payments or the fair value of the leased property, whichever is lower, and is amortized on a straight-line basis over the term of the lease or useful life of the asset, whichever is shorter. Assets under finance leases are presented under Property and equipment in the consolidated balance sheet.

Leases that do not transfer substantially all the benefits and risks incidental to ownership of the property are accounted for as operating leases. When a lease contains a predetermined fixed escalation of the minimum rent, the Corporation recognizes the related rent expense on a straight-line basis over the term of the lease and, consequently, records the difference between the recognized rental expense and the amounts payable under the lease as deferred rent expense.

The Corporation also receives tenant allowances, which are amortized on a straight-line basis over the term of the lease or useful life of the asset, whichever is shorter.

Gains and losses resulting from sale and leaseback transactions are recorded in the consolidated statements of earnings at the transaction date except if:

the sale price is below fair value and the loss is compensated for by future lease payments below market price, in which case it shall be deferred and amortized in proportion to the lease payments over the period during which the asset is expected to be used;
the sale price is above fair value, in which case the excess shall be deferred and amortized over the period during which the asset is expected to be used.

Stock-based compensation and other stock-based payments

Stock-based compensation costs are measured at the grant date of the award based on the fair value method for all transactions entered into starting in fiscal year 2003.

The fair value of stock options is recognized over the vesting period of each respective vesting portion as compensation expense with a corresponding increase in contributed surplus. When stock options are exercised, the corresponding contributed surplus is transferred to capital stock.

The Phantom Stock Units compensation cost and the related liability are recorded on a straight-line basis over the corresponding vesting period based on the fair market value of Class B shares and the best estimate of the number of Phantom Stock Units that will ultimately be paid. The recorded liability is adjusted periodically to reflect any variation in the fair market value of the Class B shares.

Employee future benefits

The Corporation accrues its obligations under employee pension plans and the related costs, net of plan assets. The Corporation has adopted the following accounting policies with respect to the defined benefit plans:

the accrued benefit obligations and the cost of pension benefits earned by active employees are actuarially determined using the projected unit credit method pro-rated on service and pension expense is recorded in earnings as the services are rendered by active employees. The calculations reflect management's best estimate of expected plan investment performance, salary escalation and retirement ages of employees;
for the purpose of calculating the expected return on plan assets, those assets are valued at fair value;
actuarial gains (losses) arise from the difference between the actual long-term rate of return on plan assets for a period and the expected long-term rate of return on plan assets for that period or from changes in actuarial assumptions used to determine the accrued benefit obligation. The excess of the net actuarial gain (loss) over 10% of the greater of the present value of the benefit obligation and the fair value of plan assets, established at the beginning of the year, is amortized over the expected average remaining active life of participating employees. The expected average remaining active life of employees covered by the pension plans is nine years;
past service costs are amortized on a straight-line basis over the average period until the benefits become vested.

The pension cost recorded in net earnings for the defined contribution plan is equivalent to the contribution which the Corporation is required to pay in exchange for services provided by the employees.

Provisions

Provisions are recognized when the Corporation has a present obligation (legal or constructive) as a result of a past event, it is probable that the Corporation will be required to settle the obligation and a reliable estimate of the amount of the obligation can be made. The amount recognized as a provision is the best estimate of the consideration required to settle the present obligation at the balance sheet date, taking into account the risks and uncertainties surrounding the obligation. Where a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows.

Onerous contracts

Present obligations arising under onerous contracts are recognized and measured as provisions. An onerous contract is considered to exist where the Corporation has a contract under which the unavoidable costs of meeting the obligations under the contract exceed the economic benefits expected to be received under it. In order to determine the initial recorded liability, the present value of estimated future cash flows is calculated using a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability.

Environmental costs

The Corporation provides for estimated future site remediation costs to meet government standards for known site contaminations when such costs can be reasonably estimated. Estimates of the anticipated future costs for remediation activities at such sites are based on the Corporation's prior experience with remediation sites and consideration of other factors such as the condition of the site contamination, location of sites and experience with contractors that perform the environmental assessments and remediation work. In order to determine the initial recorded liability, the present value of estimated future cash flows was calculated using a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability.

Asset retirement obligations

Asset retirement obligations relate to estimated future costs to remove underground motor fuel storage tanks and are based on the Corporation's prior experience in removing these tanks, estimated tank useful life, lease terms for those tanks installed on leased properties, external estimates and governmental regulatory requirements. A discounted liability is recorded for the fair value of an asset retirement obligation with a corresponding increase to the carrying value of the related long-lived asset at the time an underground storage tank is installed. To determine the initial recorded liability, the future estimated cash flows are discounted using a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. The amount added to property and equipment is amortized and an accretion expense is recognized in connection with the discounted liability over the remaining life of the tank or lease term for leased properties.

Following the initial recognition of the asset retirement obligation, the carrying amount of the liability is increased to reflect the passage of time and then adjusted for variations in the current market-based discount rate or the scheduled underlying cash flows required to settle the liability.

Obligations related to general liability and workers' compensation

In the United States, the Corporation is self-insured for certain losses related to general liability and workers' compensation. The expected ultimate cost for claims incurred as of the balance sheet date is discounted and is recognized as a liability. This cost is estimated based on analysis of the Corporation's historical data and actuarial estimates. In order to determine the initial recorded liability, the present value of estimated future cash flows is calculated using a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability.

Financial instruments recognition and measurement

The Corporation has made the following classifications for its financial assets and liabilities:

Financial assets and liabilities	Classification	Subsequent measurement ⁽¹⁾	Classification of gains and losses
Cash and cash equivalents	Loans and receivables	Amortized cost	Net earnings
Accounts receivable	Loans and receivables	Amortized cost	Net earnings
Investments in publicly-traded securities	Available for sale	Fair value	Other comprehensive income
Bank indebtedness and long-term debt	Other financial liabilities	Amortized cost	Net earnings
Accounts payable and accrued liabilities	Other financial liabilities	Amortized cost	Net earnings

⁽¹⁾ Initial measurement of all financial assets and liabilities is at fair value.

Business combinations

Business combinations are accounted for using the purchase method. The cost of a business combination is measured as the aggregate of the fair values (at the date of acquisition) of assets given, liabilities incurred or assumed, and equity instruments issued by the Corporation in exchange for control of the acquiree. The acquiree's identifiable assets, liabilities and contingent liabilities that meet the conditions for recognition under IFRS 3 "Business Combinations" are recognized at their fair values at the acquisition date. Direct acquisition costs are recorded to earnings when incurred.

Goodwill arising from business combinations is recognized as an asset and initially measured at cost, being the excess of the cost of the business combination over the Corporation's interest in the net fair value of the identifiable assets, liabilities and contingent liabilities recognized. If, after reassessment, the Corporation's interest in the net fair value of the acquiree's identifiable assets, liabilities and contingent liabilities exceeds the cost of the business combination, the excess is recognized immediately to earnings.

Earnings from the businesses acquired are included in the consolidated statements of earnings from their respective dates of acquisition.

3. RECENTLY ISSUED ACCOUNTING STANDARDS NOT YET IMPLEMENTED

Revised Standards

Financial Statement Presentation

In June 2011, the IASB issued amendments to IAS 1, "Presentation of Financial Statements". The amendments govern the presentation of Other Comprehensive Income ("OCI") in the financial statements, primarily by requiring OCI items that may be reclassified to the statement of earnings to be presented separately from those that remain in equity.

These changes are applicable for fiscal years beginning on or after July 1^st, 2012. The Corporation will apply these changes for its first quarter of fiscal year 2013 and is still evaluating their impact but does not expect a significant impact on its consolidated financial statements.

Employee Benefits

In June 2011, the IASB issued a revised version of IAS 19 "Employee Benefits" to modify accounting rules for defined benefits pension plans. The revised version of the standard contains multiple modifications, including the elimination of the corridor approach, which allowed deferring part of actuarial gains and losses, as well as enhanced guidance on measurement of plan assets and defined benefit obligations, streamlining the presentation of changes in assets and liabilities arising from defined benefit plans and the introduction of enhanced disclosures for defined benefit plans.

These changes are applicable for fiscal years beginning on or after January 1^st, 2013. The Corporation will apply these changes for its first quarter of fiscal year 2014 and is still evaluating their impact on its consolidated financial statements.

Financial Instruments - Presentation and disclosure

In December 2011, the IASB issued revised versions of IFRS 7 "Financial instruments: disclosures" and IAS 32 "Financial instruments: presentation". The modifications clarify the offsetting rules and state new disclosure requirements for offsetting of financial assets and liabilities on the balance sheet.

The changes applied to IFRS 7 are applicable for fiscal years beginning on or after January 1^st, 2013 while changes applied to IAS 32 are applicable for fiscal years beginning on or after January 1^st, 2014. The Corporation will apply these changes for its first quarter of fiscal years 2014 and 2015, respectively and is still evaluating their impact but does not expect a significant impact on its consolidated financial statements.

New standards

Financial Instruments

In November 2009, the IASB issued a new standard, IFRS 9 "Financial Instruments" which is the first phase of the IASB's three-phase project to replace IAS 39 "Financial Instruments: Recognition and Measurement". The standard provides guidance on the classification and measurement of financial liabilities and requirements for the derecognition of financial assets and financial liabilities.

Consolidated financial statements

In May 2011, the IASB issued a new standard, IFRS 10 "Consolidated Financial Statements" which requires an entity to consolidate an investee when it is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. Under existing IFRS, consolidation is required when an entity has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. IFRS 10 replaces SIC-12 "Consolidation—Special Purpose Entities" and parts of IAS 27 "Consolidated and Separate Financial Statements".

Joint Arrangements

In May 2011, the IASB issued a new standard, IFRS 11 "Joint Arrangements" which requires a venturer to classify its interest in a joint arrangement as a joint venture or joint operation. Joint ventures will be accounted for using the equity method of accounting whereas for a joint operation the venturer will recognize its share of the assets, liabilities, revenue and expenses of the joint operation. Under existing IFRS, entities have the choice to proportionately consolidate or equity account for interests in joint ventures. IFRS 11 supersedes IAS 31 "Interests in Joint Ventures", and SIC-13 "Jointly Controlled Entities—Non-monetary Contributions by Venturers".

Disclosure of Interest in Other Entities

In May 2011, the IASB issued a new standard, IFRS 12 "Disclosure of Interest in Other Entities". IFRS 12 establishes disclosure requirements for interests in other entities, such as joint arrangements, associates, special purpose vehicles and off balance sheet vehicles. The standard includes existing disclosures and also introduces significant additional disclosure requirements that address the nature of, and risks associated with, an entity's interests in other entities.

Fair Value Measurement

In May 2011, the IASB issued a new standard, IFRS 13 "Fair value measurement". IFRS 13 is a comprehensive standard for fair value measurement and disclosure requirements for use across all IFRS standards. The new standard clarifies that fair value is the price that would be received to sell an asset, or paid to transfer a liability in an orderly transaction between market participants, at the measurement date. It also establishes disclosures about fair value measurement. Under existing IFRS, guidance on measuring and disclosing fair value is dispersed among the specific standards requiring fair value measurements and in many cases does not reflect a clear measurement basis or consistent disclosures.

IFRS 9, 10, 11, 12 and 13 are all applicable for fiscal years beginning on or after January 1^st, 2013. The Corporation will apply these new standards for its first quarter of fiscal year 2014 and is still evaluating their impact on its consolidated financial statements.

4. LONG-TERM DEBT

On December 9, 2011, the Corporation entered into a new credit agreement consisting of a revolving unsecured facility of an initial maximum amount of $1,000.0 with an initial term of five years. The credit facility is available in the following forms:

A term revolving unsecured operating credit, available i) in Canadian dollars, ii) in US dollars, iii) in the form of Canadian dollar bankers' acceptances, with stamping fees and iv) in the form of standby letters of credit not exceeding $100.0 or the equivalent in Canadian dollars, with applicable fees. Depending on the form and the currency of the loan, the amounts borrowed bear interest at variable rates based on the Canadian prime rate, the bankers' acceptance rate, the US base rate or LIBOR plus a variable margin; and
An unsecured line of credit in the maximum amount of $50.0, available in Canadian or US dollars, bearing interest at variable rates based, depending on the form and currency of the loan, on the Canadian prime rate, the US prime rate or the US base rate plus a variable margin.

Under the credit agreement, the Corporation must maintain certain financial ratios and respect certain restrictive provisions.

Considering this new agreement, the amounts available under the previously existing credit agreements were adjusted as follows:

Operating credit A's initial amount of $650.0 was reduced to $326.0; and
Operating credit B's initial amount of $310.0 was reduced to $154.0.

As at January 29, 2012, the weighted average effective interest rate is 0.89% for the US dollar portion and 1.93% for the Canadian dollar portion (0.81% at January 30, 2011 for both the US dollar portion and Canadian dollar portion). In addition, CA$1.5 (CA$0.8 as at January 30, 2011) and $28.5 ($29.4 as at January 30, 2011) are used for standby letters of credit. As at January 29, 2012, the available lines of credit were unused and the Corporation was in compliance with the restrictive provisions and ratios imposed by the credit agreements.

5. BUSINESS ACQUISITIONS

●	In May 2011, the Corporation purchased 11 company-operated stores located in Ontario, Manitoba, Saskatchewan, Alberta and British-Columbia from Shell Canada Products. The Corporation leases the land and buildings for four sites and owns both these assets for the other sites.
●	In June 2011, the Corporation signed an agreement with ExxonMobil for 322 stores and motor fuel supply agreements for another 63 stores. All stores are operated in Southern California, United States. The transaction is scheduled to close in stages: the first stages occurred during the month of August 2011 and final stages should occur by the end of calendar year 2012. The transaction is subject to standard regulatory approvals and closing conditions. The following is a summary of progress made during the 40-week period ended on January 29, 2012 and steps that should be completed subsequently:
	-	In August 2011, the Corporation purchased one company-operated store for which it owns the land and building and it acquired the motor fuel supply agreements for 63 other stores;
	-	In October 2011, the Corporation acquired one company-operated store for which it owns the land and building as well as 83 stores operated by independent operators for which the Corporation owns the buildings and leases the land;
	-	At end of October 2011 and beginning of November 2011, the Corporation acquired 72 company-operated stores for which it owns the land and buildings for 37 stores and leases the land and owns the building for the other stores;
	-	Subsequent to the 40-week period ended January 29, 2012 and consequentially not reflected into the purchase price allocation table below :
		●	As at January 29, 2012, 164 sites operated by independent operators along with related motor fuel supply agreements remained to be integrated to the Corporation's network. However, the sale to the Corporation by ExxonMobil of real estate for these sites is conditional to ExxonMobil's obligation to submit a bona fide offer to each independent operator. If the offer is accepted by the independent operator than only the motor fuel supply agreement is transferred to the Corporation.
		●	Between January 29, 2012 and March 13, 2012, the Corporation acquired seven stores operated by independent operators for which the real estate is owned by the Corporation along with the related motor fuel supply agreements. Additionally, during this time period, three independent operators elected to accept ExxonMobil's bona fide offer. Consequentially, three fuel supply agreements were transferred to the Corporation during this period.
		●	By the end of calendar year 2012, the Corporation expects to acquire 140 stores operated by independent operators and for which the real estate should be owned by the Corporation and expects 14 fuel supply agreements to be transferred to the Corporation.
●	On October 13, 2011, the Corporation acquired from Chico Enterprises Inc., 26 company-operated stores operating in northern West Virginia, United States. The Corporation owns the real estate for 25 sites while it owns the building and leases the land for the other site.
●	On November 16 and 17, 2011, the Corporation acquired from ExxonMobil, 33 company-operated stores operating under the "On the Run" banner in Louisiana, United States. The Corporation owns the buildings for 33 sites as well as land for 25 sites while it leases the land for the other eight sites.
●	On December 12, 2011, the Corporation acquired from Neighbors Stores Inc., 11 company-operated stores operating under the "Neighbors" banner in North Carolina, United States. The Corporation owns the buildings for eight sites as well as land for nine sites while it leases theses same assets for the other sites.
●	During the 40-week period ended January 29, 2012, the Corporation also acquired 15 other stores through distinct transactions. The Corporation leases the land and buildings for seven sites and owns both these assets for the other sites.

Acquisition costs in connection with these acquisitions are included in Operating, selling, administrative and general expenses. These acquisitions were settled for a total cash consideration of $350.3.

Purchase price allocations based on the estimated fair value on the dates of acquisition are as follows:

		$
Tangible assets acquired
	Inventories	17.4
	Property and equipment	241.0
	Other assets	2.1
Total tangible assets		260.5
Liabilities assumed
	Accounts payable and accrued liabilities	1.3
	Deferred credits and other liabilities	23.8
Total liabilities		25.1
Net tangible assets acquired		235.4
Intangibles assets		43.9
Goodwill		72.3
Negative goodwill recorded to earnings		(1.3)
Total cash consideration paid		350.3

The Corporation expects that approximately $4.8 of the goodwill related to these transactions will be deductible for tax purposes.

These acquisitions were concluded in order to expand the Corporation's market share and to increase its economies of scale. These acquisitions generated goodwill in the amount of $72.3 mainly due to the location of stores which is favorable to the Corporation's operations: accessible location, limited competition, proximity to target clientele. Since the date of acquisition, revenues and net earnings from these stores amounted to $616.1 and $3.0, respectively. Considering de nature of these acquisitions, the available financial information does not allow for the accurate disclosure of pro-forma Revenues and Net earnings had the Corporation concluded these acquisitions at the beginning of the year.

On May 11, 2011, the Corporation, through the RDK joint venture, purchased four company-operated stores located in the Chicago area, United States, from Gas City, Ltd. RDK leases the land and buildings for one site and owns both these assets for the other sites.

On November 8, 9 and 10, 2011, the Corporation, through the RDK joint venture, acquired from Supervalu Inc., 27 stores operating in the Chicago area, Illinois, United States. The agreement also includes the transfer to RDK of two vacant land parcels. Out of the 27 stores, 14 are company-operated while the other 13 are operated by independent operators. RDK owns the real estate for 24 sites as well as the two vacant land parcels, owns the building and leases the land for two sites and leases both these assets for the remaining site.

6. NET EARNINGS PER SHARE

	16-week period ended January 29, 2012			16-week period ended January 30, 2011
	Net earnings	Weighted average number of shares (in thousands)	Net earnings per share	Net earnings	Weighted average number of shares (in thousands)	Net earnings per share
	$		$	$		$
Basic net earnings attributable to Class A and B shareholders	86.8	177,731	0.49	69.6	184,486	0.38
Dilutive effect of stock options		3,528	(0.01)		3,724	(0.01)
Diluted net earnings available for Class A and B shareholders	86.8	181,259	0.48	69.6	188,210	0.37

	40-week period ended January 29, 2012			40-week period ended January 30, 2011
	Net earnings	Weighted average number of shares (in thousands)	Net earnings per share	Net earnings	Weighted average number of shares (in thousands)	Net earnings per share
	$		$	$		$
Basic net earnings attributable to Class A and B shareholders	339.8	180,866	1.88	304.7	185,025	1.65
Dilutive effect of stock options		3,498	(0.04)		3,544	(0.03)
Diluted net earnings available for Class A and B shareholders	339.8	184,364	1.84	304.7	188,569	1.62

When they have an anti-dilutive effect, stock options must be excluded from the calculation of the diluted net earnings per share. No stock options were excluded for the 16 and 40-week periods ended January 29, 2012. There are 304,500 and 636,405 stock options excluded from the calculation for the 16 and 40-week periods ended January 30, 2011, respectively.

7. CAPITAL STOCK

As at January 29, 2012, the Corporation has 53,686,412 (53,698,712 as at January 30, 2011) issued and outstanding Class A multiple voting shares each comprising ten votes per share and 125,292,818 (129,983,221 as at January 30, 2011) outstanding Class B subordinate voting shares each comprising one vote per share.

Since October 25, 2010, the Corporation had a share repurchase program which expired on October 24, 2011. This program allowed the Corporation to repurchase up to 2,685,335 of the 53,706,712 Class A multiple voting shares and up to 11,621,801 of the 116,218,014 Class B subordinate voting shares issued and outstanding as at October 20, 2010 (representing 5.0% of the Class A multiple voting shares issued and outstanding and 10.0% of the Class B subordinate voting shares of the public float, as at that date, respectively, as defined by applicable rules). In accordance with Toronto Stock Exchange requirements, the Corporation could repurchase a daily maximum of 1,000 Class A multiple voting shares and of 83,622 Class B subordinate voting shares. When making such repurchases, the number of Class A multiple voting shares and of Class B subordinate voting shares in circulation has been reduced and the proportionate interest of all remaining shareholders in the Corporation's share capital was increased on a pro rata basis. All shares repurchased under the share repurchase program were cancelled upon repurchase. The following table summarizes share repurchases made under this program.

	16-week period ended January 29, 2012		40-week period ended January 29, 2012		Since implementation of the program
	Number of shares repurchased	Weighted average cost per share	Number of shares repurchased	Weighted average cost per share	Number of shares repurchased	Weighted average cost per share
Class A multiple voting shares	1,000	CA$29.50	2,700	CA$29.44	14,700	CA$26.08
Class B subordinate voting shares	206,700	CA$29.28	4,559,900	CA$28.81	7,328,200	CA$27.40

On October 25, 2011, the Corporation implemented a new share repurchase program. This program allows the Corporation to repurchase up to 2,684,420 of the 53,688,412 Class A multiple voting shares and up to 11,126,400 of the 111,264,009 Class B subordinate voting shares issued and outstanding as at October 11, 2011 (representing 5.0% of the Class A multiple voting shares issued and outstanding and 10.0% of the Class B subordinate voting shares of the public float, as at that date, respectively, as defined by applicable rules). In accordance with Toronto Stock Exchange requirements, the Corporation can repurchase a daily maximum of 1,000 Class A multiple voting shares and of 82,118 Class B subordinate voting shares. When making such repurchases, the number of Class A multiple voting shares and of Class B subordinate voting shares in circulation is reduced and the proportionate interest of all remaining shareholders in the Corporation's share capital is increased on a pro rata basis. All shares repurchased under the share repurchase program are cancelled upon repurchase. The share repurchase period will end no later than October 24, 2012. The following table summarizes share repurchases made under this program since its implementation.

	16-week period ended January 29, 2012		40-week period ended January 29, 2012		Since implementation of the program
	Number of shares repurchased	Weighted average cost per share	Number of shares repurchased	Weighted average cost per share	Number of shares repurchased	Weighted average cost per share
Class A multiple voting shares	1,000	CA$30.50	1,000	CA$30.50	1,000	CA$30.50
Class B subordinate voting shares	2,409,300	CA$30.19	2,409,300	CA$30.19	2,409,300	CA$30.19

For the 16-week period ended January 29, 2012, a total of 2,171,724 Class B subordinate voting shares were issued following the exercise of stock options (517,255 for the 16-week period ended January 30, 2011). For the 40-week period ended January 29, 2012, a total of 2,358,141 Class B subordinate voting shares were issued following the exercise of stock options (2,393,228 for 40-week period ended January 30, 2011).

8. SEGMENTED INFORMATION

The Corporation operates convenience stores in the United States and in Canada. It essentially operates in one reportable segment, the sale of goods for immediate consumption and motor fuel through corporate stores or franchise operations. It operates a convenience store chain under several banners, including Couche-Tard, Mac's and Circle K. Revenues from outside sources mainly fall into two categories: merchandise and services and motor fuel.

The following table provides the information on the principal revenue classes as well as geographic information:

	16-week period ended January 29, 2012			16-week period ended January 30, 2011
	United States	Canada	Total	United States	Canada	Total
	$	$	$	$	$	$
External customer revenues ^(a)
Merchandise and services	1,272.5	595.4	1,867.9	1,200.8	585.0	1,785.8
Motor fuel	3,969.0	767.2	4,736.2	3,047.7	653.4	3,701.1
	5,241.5	1,362.6	6,604.1	4,248.5	1,238.4	5,486.9
Gross Profit
Merchandise and services	420.9	193.2	614.1	398.4	195.3	593.7
Motor fuel	171.4	41.0	212.4	138.1	43.2	181.3
	592.3	234.2	826.5	536.5	238.5	775.0
Total non-current assets ^(b)	2,374.5	612.8	2,987.3	2,058.7	548.0	2,606.7

	40-week period ended January 29, 2012			40-week period ended January 30, 2011
	United States	Canada	Total	United States	Canada	Total
	$	$	$	$	$	$
External customer revenues ^(a)
Merchandise and services	3,298.3	1,685.3	4,983.6	3,178.5	1,602.2	4,780.7
Motor fuel	9,901.7	2,049.0	11,950.7	7,439.0	1,593.7	9,032.7
	13,200.0	3,734.3	16,934.3	10,617.5	3,195.9	13,813.4
Gross Profit
Merchandise and services	1,088.7	563.4	1,652.1	1,049.5	552.3	1,601.8
Motor fuel	473.1	112.3	585.4	424.0	106.5	530.5
	1,561.8	675.7	2,237.5	1,473.5	658.8	2,132.3

	(a)	Geographic areas are determined according to where the Corporation generates operating income (where the sale takes place) and according to the location of the non-current assets.
	(b)	Excluding financial instruments, deferred tax assets and post-employment benefit assets.

9. PROVISIONS

The reconciliation of the Corporation's main provisions is as follows:

		Asset retirement obligation	Provision for site restoration costs	Provision for workers' compensation	Provision for general liability	Other provisions	Total
		$	$	$	$	$	$
40-week period ended January 29, 2012

Balance, beginning of period		60.8	25.5	25.0	13.7	-	125.0
	Liabilities incurred	0.4	5.8	11.9	5.5	-	23.6
	Liabilities settled	(1.1)	(4.9)	(10.7)	(4.4)	-	(21.1)
	Accretion expense	3.6	0.2	0.5	0.1	-	4.4
	Business acquisitions	1.8	22.0	-	-	-	23.8
	Reversal of provision	(0.2)	(2.2)	-	-	-	(2.4)
	Change in estimates	-	0.1	-	0.1	-	0.2
	Effect of exchange rate variations	(0.4)	(0.4)	-	-	-	(0.8)
Balance, end of period		64.9	46.1	26.7	15.0	-	152.7
Current portion of provisions							47.8
Long term portion of provisions							104.9

52-week period ended April 24, 2011

Balance, beginning of period		56.4	26.6	23.3	12.0	0.8	119.1
	Liabilities incurred	0.5	8.3	15.7	9.0	-	33.5
	Liabilities settled	(1.6)	(6.2)	(14.4)	(7.4)	(0.8)	(30.4)
	Accretion expense	4.5	0.3	0.5	0.1	-	5.4
	Business acquisitions	0.4	-	-	-	-	0.4
	Reversal of provision	-	(3.8)	(0.1)	(0.1)	-	(4.0)
	Change in estimates	-	-	-	0.1	-	0.1
	Effect of exchange rate variations	0.6	0.3	-	-	-	0.9
Balance, end of period		60.8	25.5	25.0	13.7	-	125.0
Current portion of provisions							36.3
Long term portion of provisions							88.7

10. SUBSEQUENT EVENTS

In February 2012, the Corporation signed an agreement to acquire 20 company-operated stores operating in Texas, United States. Assuming the closing of the transaction which is scheduled for May 2012, the Corporation would lease the real estate for all sites. The transaction is subject to standard regulatory approvals and closing conditions.

11. FIRST-TIME ADOPTION OF IFRS

The consolidated financial statements for the fiscal year ended April 29, 2012 will be the first annual consolidated financial statements of the Corporation prepared in accordance with IFRS. These interim financial statements have been prepared in accordance with applicable standards for interim financial reporting, as issued by the IASB. The date of the Corporation's transition to IFRS is April 26, 2010.

The Corporation's IFRS accounting policies presented in Note 2 have been applied in preparing the interim financial statements for the 16 and 40-week periods ended January 29, 2012, for the comparative information and for the opening consolidated balance sheet at the date of transition.

The Corporation has applied IAS 34, "Interim Financial Reporting" and IFRS 1 "First-time Adoption of International Financial Reporting Standards" in preparing its first IFRS interim financial statements. The effects of the transition to IFRS on the consolidated statements of earnings, consolidated statements of comprehensive income, consolidated balance sheets, consolidated shareholders' equity and consolidated cash flows are presented in this section and are further explained in the explanatory notes that accompany the tables.

First-time adoption exemptions

Upon transition, IFRS 1 imposes certain mandatory exceptions and permits certain exemptions from full retrospective application. The Corporation has applied the mandatory exceptions and the following optional exemptions:

Mandatory exceptions applied by the Corporation:

Financial assets and liabilities that had been de-recognized before April 26, 2010 under Canadian GAAP have not been recognized under IFRS.
The Corporation has only applied hedge accounting in the opening statement of financial position where all the requirements in IAS 39 were met at the date of transition.
The estimates previously established under Canadian GAAP have not been revised following the adoption of IFRS, unless it was necessary to take into account differences in accounting policies.

Other optional exemptions adopted by the Corporation:

The Corporation has elected not to apply IFRS 3 "Business Combinations" retrospectively to business combinations that occurred before the date of transition (April 26, 2010), including business acquisitions done by the joint venture. See note g) to obtain an explanation of the effect of this exemption.
For all its employee future benefits plans, the Corporation has elected to recognize all cumulative actuarial gains and losses existing at the transition date to retained earning. See note d) to obtain an explanation of the effect of this exemption.
The Corporation has elected not to retrospectively recognize the effect on the assets of the variances related to its existing asset retirement obligation and similar liabilities, which may have occurred before the transition date.
The Corporation elected to use facts and circumstances existing as at April 26, 2010 to determine whether an arrangement signed before April 26, 2004 contains a lease. The arrangements signed after that date were evaluated under Canadian GAAP and were not analyzed in detail since this analysis would have given similar conclusions as per IAS 17 and IFRIC 4.
The Corporation elected to avail itself of the exemption provided under IFRS 1 and applied IFRS 2 for all equity instruments granted after April 29, 2002.
The Corporation elected to reset all cumulative translation adjustments to zero in opening retained earnings at its Transition Date.

Reconciliation of consolidated balance sheets and Shareholders' equity as at April 26, 2010
			Reconciling items with IFRS
		Balance sheet under Canadian GAAP	Sale and leaseback transactions	Discounting of provisions	Onerous contracts	Employee future benefits	Stock options	Joint venture	Presentation differences	Cumulative translation adjustment reversal	Balance sheet under IFRS
Explanatory notes			a)	b)	c)	d)	e)	f)	h)	i)
		$	$	$	$	$	$	$	$	$	$

Assets
Current assets
	Cash and cash equivalents	220.9						(5.2)			215.7
	Accounts receivable	286.2						(5.4)			280.8
	Inventories	474.1						(4.2)			469.9
	Prepaid expenses	20.2						(0.2)			20.0
	Income taxes receivable	4.7							13.0		17.7
	Deferred income taxes	24.9							(24.9)		-
		1,031.0	-	-	-	-	-	(15.0)	(11.9)	-	1,004.1
Property and equipment		1,980.5						(65.6)			1,914.9
Goodwill		426.5						(1.2)			425.3
Intangible assets		188.2									188.2
Other assets		65.2		(1.1)		(8.3)					55.8
Investment in a joint venture		-						42.1			42.1
Deferred income taxes		5.3			0.2	3.0			0.1		8.6
		3,696.7	-	(1.1)	0.2	(5.3)	-	(39.7)	(11.8)	-	3,639.0

Liabilities
Current liabilities
	Accounts payable and accrued liabilities	872.9	(0.1)					(14.2)	(36.9)		821.7
	Provisions	-							31.4		31.4
	Current portion of long-term debt	4.4									4.4
	Deferred income taxes	5.6		0.2		(3.0)			(2.8)		-
		882.9	(0.1)	0.2	-	(3.0)	-	(14.2)	(8.3)	-	857.5
Long-term debt		736.8						(24.9)			711.9
Provisions		-		(3.4)	0.8				90.3		87.7
Deferred credits and other liabilities		285.8	(98.6)			13.2		(0.6)	(71.8)		128.0
Deferred income taxes		176.9	38.4	0.6					(22.0)		193.9
		2,082.4	(60.3)	(2.6)	0.8	10.2	-	(39.7)	(11.8)	-	1,979.0

Shareholders' equity
Capital stock		319.5									319.5
Contributed surplus		18.8					1.6				20.4
Retained earnings		1,167.0	60.3	1.5	(0.6)	(15.5)	(1.6)			108.6	1,319.7
Accumulated other comprehensive income		109.0								(108.6)	0.4
		1,614.3	60.3	1.5	(0.6)	(15.5)	-	-	-	-	1,660.0
		3,696.7	-	(1.1)	0.2	(5.3)	-	(39.7)	(11.8)	-	3,639.0

Reconciliation of consolidated balance sheets and Shareholders' equity as at April 24, 2011

			Reconciling items with IFRS
Explanatory notes		Balance sheet under Canadian GAAP	Sale and leaseback transactions a)	Discounting of provisions b)	Employee future benefits d)	Stock option e)	Joint venture f)	Business combinations - acquisition costs g)	Presentation differences h)	Cumulative translation adjustment reversal i)	Balance sheet under IFRS
		$	$	$	$	$	$	$	$	$	$

Assets
Current assets
	Cash and cash equivalents	320.4					(10.7)				309.7
	Accounts receivable	356.1					(6.9)	(0.1)			349.1
	Inventories	530.7					(4.7)				526.0
	Prepaid expenses	21.3					(0.3)				21.0
	Income taxes receivable	26.6							9.8		36.4
	Deferred income taxes	33.9		(0.2)	2.8				(36.5)		-
		1,289.0	-	(0.2)	2.8	-	(22.6)	(0.1)	(26.7)	-	1,242.2
Property and equipment		2,002.8					(67.2)	(0.2)			1,935.4
Goodwill		442.5					(1.1)	(0.5)			440.9
Intangible assets		188.6									188.6
Other assets		66.9		(0.8)	(7.9)		(0.2)				58.0
Investment in a joint venture		-					48.2				48.2
Deferred income taxes		9.8			2.9						12.7
		3,999.6	-	(1.0)	(2.2)	-	(42.9)	(0.8)	(26.7)	-	3,926.0

Liabilities
Current liabilities
	Accounts payable and accrued liabilities	994.5	(0.2)				(17.5)		(40.3)		936.5
	Provisions	-							36.3		36.3
	Current portion of long-term debt	4.6									4.6
	Deferred income taxes	21.2							(21.2)		-
		1,020.3	(0.2)	-	-	-	(17.5)	-	(25.2)	-	977.4
Long-term debt		521.8					(24.9)				496.9
Provisions		-		(3.3)					92.0		88.7
Deferred credits and other liabilities		299.0	(95.6)		13.0		(0.5)		(78.2)		137.7
Deferred income taxes		222.4	37.2	0.7				(0.3)	(15.3)		244.7
		2,063.5	(58.6)	(2.6)	13.0	-	(42.9)	(0.3)	(26.7)	-	1,945.4

Shareholders' equity
Capital stock		323.8									323.8
Contributed surplus		18.1				1.2					19.3
Retained earnings		1,444.5	58.5	1.6	(15.2)	(1.2)		(0.5)		108.6	1,596.3
Accumulated other comprehensive income		149.7	0.1							(108.6)	41.2
		1,936.1	58.6	1.6	(15.2)	-	-	(0.5)	-	-	1,980.6
		3,999.6	-	(1.0)	(2.2)	-	(42.9)	(0.8)	(26.7)	-	3,926.0


Reconciliation of consolidated statement of earnings and consolidated comprehensive income for the year ended April 24, 2011

			Reconciling items with IFRS
Explanatory notes		Statement of earnings under Canadian GAAP	Sale and leaseback transactions a)	Discounting of provisions b)	Onerous contracts c)	Employee future benefits d)	Stock option e)	Joint venture f)	Business combinations - acquisition costs g)	Presentation differences h)	Statement of earnings under IFRS
		$	$	$	$	$	$	$	$	$	$

Revenues		18,965.9						(415.5)			18,550.4
Cost of sales		16,180.7						(376.0)			15,804.7
Gross profit		2,785.2	-	-	-	-	-	(39.5)	-	-	2,745.7

Operating, selling, administrative and general expenses		2,050.4	3.0	(0.9)	(0.8)	(0.6)	(0.4)	(18.1)	0.8	(4.5)	2,028.9
Depreciation and amortization of property and equipment and other assets		216.3						(2.6)			213.7
Operating income		518.5	(3.0)	0.9	0.8	0.6	0.4	(18.8)	(0.8)	4.5	503.1
Share of earnings of a joint venture accounted for using the equity method		-						16.9			16.9
Financial expenses		37.6		0.7				(1.9)		4.5	40.9
Financial revenues		(11.3)									(11.3)
Net financial expenses		26.3	-	0.7	-	-	-	(1.9)	-	4.5	29.6
Earnings before income taxes		492.2	(3.0)	0.2	0.8	0.6	0.4	-	(0.8)	-	490.4
Income taxes		122.1	(1.2)	0.1	0.2	0.3			(0.3)		121.2
Net earnings		370.1	(1.8)	0.1	0.6	0.3	0.4	-	(0.5)	-	369.2
	Changes in cumulative translation adjustments	40.0									40.0
	Change in fair value of a financial instrument designated as a cash flow hedge	2.0									2.0
	Gain realized on a financial instrument designated as a cash flow hedge transferred to earnings	(1.3)									(1.3)
Comprehensive income		410.8	(1.8)	0.1	0.6	0.3	0.4	-	(0.5)	-	409,9

Reconciliation of consolidated Shareholders' equity as at January 30, 2011

			Reconciling items with IFRS
Explanatory notes		Shareholders' equity under Canadian GAAP	Sale and leaseback transactions a)	Discounting of provisions b)	Onerous contracts c)	Employee future benefits d)	Stock option e)	Business combinations acquisition cost g)	Cumulative translation adjustment reversal i)	Shareholders' equity under IFRS
		$	$	$	$	$	$	$	$	$
Shareholders' equity
Capital stock		323.5								323.5
Contributed surplus		17.9					1.2			19.1
Retained earnings		1,397.7	59.3	1.2	(0.4)	(15.7)	(1.2)	(0.5)	108.6	1,549.0
Accumulated other comprehensive income		111.0							(108.6)	2.4
		1,850.1	59.3	1.2	(0.4)	(15.7)	-	(0.5)	-	1,894.0


Reconciliation of consolidated statement of earnings and consolidated comprehensive income for the 16-week period ended January 30, 2011

			Reconciling items with IFRS
Explanatory notes		Statement of earnings under Canadian GAAP	Sale and leaseback transactions a)	Discounting of provisions b)	Onerous contracts c)	Stock option e)	Joint venture f)	Business combinations - acquisition costs g)	Presentation differences h)	Statement of earnings under IFRS
		$	$	$	$	$	$	$	$	$

Revenues		5,611.2					(124.3)			5,486.9
Cost of sales		4,825.3					(113.4)			4,711.9
Gross profit		785.9	-	-	-	-	(10.9)	-	-	775.0
Operating, selling, administrative and general expenses		616.8	1.9		(0.1)	(0.2)	(5.7)	0.2	(1.4)	611.5
Depreciation and amortization of property and equipment and other assets		67.0					(0.9)			66.1
Operating income		102.1	(1.9)	-	0.1	0.2	(4.3)	(0.2)	1.4	97.4
Share of earnings of a joint venture accounted for using the equity method		-					3.8			3.8
Financial expenses		19.5		0.3			(0.5)		1.4	20.7
Financial revenues		(9.5)								(9.5)
Net financial expenses		10.0	-	0.3	-	-	(0.5)	-	1.4	11.2
Earnings before income taxes		92.1	(1.9)	(0.3)	0.1	0.2	-	(0.2)	-	90.0
Income taxes		21.1	(0.7)	(0.1)	0.1			-		20.4
Net earnings		71.0	(1.2)	(0.2)	-	0.2	-	(0.2)	-	69.6
	Changes in cumulative translation adjustments	3.0								3.0
	Change in fair value of a financial instrument designated as a cash flow hedge	1.0								1.0
	Gain realized on a financial instrument designated as a cash flow hedge transferred to earnings	(0.6)								(0.6)
Comprehensive income		74.4	(1.2)	(0.2)	-	0.2	-	(0.2)	-	73.0

Reconciliation of consolidated statement of earnings and consolidated comprehensive income for the 40-week period ended January 30, 2011
			Reconciling items with IFRS
Explanatory notes		Statement of earnings under Canadian GAAP	Sale and leaseback transactions a)	Discounting of provisions b)	Onerous contracts c)	Employee future benefits d)	Stock option e)	Joint venture f)	Business combinations - acquisition costs g)	Presentation differences h)	Statement of earnings under IFRS
		$	$	$	$	$	$	$	$	$	$

Revenues		14,124.8						(311.4)			13,813.4
Cost of sales		11,960.4						(279.3)			11,681.1
Gross profit		2,164.4	-	-	-	-	-	(32.1)	-	-	2,132.3

Operating, selling, administrative and general expenses		1,565.9	1.5	(0.2)	(0.3)		(0.4)	(14.4)	0.6	(3.5)	1,549.2
Depreciation and amortization of property and equipment and other assets		164.8						(2.0)			162.8
Operating income		433.7	(1.5)	0.2	0.3	-	0.4	(15.7)	(0.6)	3.5	420.3
Share of earnings of a joint venture accounted for using the equity method		-						14.3			14.3
Financial expenses		35.5		0.6				(1.4)		3.5	38.2
Financial revenues		(11.2)									(11.2)
Net financial expenses		24.3	-	0.6	-	-	-	(1.4)	-	3.5	27.0
Earnings before income taxes		409.4	(1.5)	(0.4)	0.3		0.4	-	(0.6)	-	407.6
Income taxes		103.3	(0.5)	(0.1)	0.1	0.2			(0.1)		102.9
Net earnings		306.1	(1.0)	(0.3)	0.2	(0.2)	0.4	-	(0.5)	-	304.7
	Changes in cumulative translation adjustments	0.8									0.8
	Change in fair value of a financial instrument designated as a cash flow hedge	2.3									2.3
	Gain realized on a financial instrument designated as a cash flow hedge transferred to earnings	(1.1)									(1.1)
Comprehensive income		308.1	(1.0)	(0.3)	0.2	(0.2)	0.4	-	(0.5)	-	306.7

Explanatory notes related to the reconciliations

a) Deferred gains on sale and leaseback recognition

Under Canadian GAAP: CICA Handbook Section 3065 "Leases" required that any profit or loss arising from a sale and leaseback transaction be deferred and amortized over the lease term. A loss was recognized to earnings immediately when, at the time of the transaction, the fair value of the property was less than its carrying value.

Under IFRS: IAS 17 "Leases" requires the immediate recognition of all profits or losses arising from a sale and leaseback transaction except if:

the sale price is below fair value and the loss is compensated for by future lease payments below market price, in which case it shall be deferred and amortized in proportion to the lease payments over the period during which the asset is expected to be used;
the sale price is above fair value, in which case the excess shall be deferred and amortized over the period during which the asset is expected to be used.

Considering this difference, the Corporation analyzed all deferred gains existing at the transition date. When the transactions were concluded at fair value, the deferred gains in the balance sheet at the transition date were reversed and recognized to retained earnings. The amortization of the deferred gains recognized in 2011 was reversed and all deferred gains from sale and leaseback transactions realized in 2011 were reclassified and recognized directly to earnings.

b) Discounting of provisions

Under Canadian GAAP: The only provision that needed to be discounted was the asset retirement obligation provision and changes in the discount rate were not applied retroactively.

Under IFRS: IAS 37 "Provisions, contingent liabilities and contingent assets" states that where the effect of the time value of money is material, the amount of a provision shall be the present value of the expenditures expected to be required to settle the obligation.

Considering this difference, the Corporation reviewed all provisions recorded in its balance sheet at the transition date and discounted those for which the time value of money had a significant impact. This resulted in the reduction of the provision balances in the balance sheet at the transition date. For fiscal 2011, new expenses recognized to earnings related to these provisions have been reduced to reflect their discounting and an accretion expense has been recorded to earnings.

c) Onerous contracts

Under Canadian GAAP: Provisions were not recognized for onerous contracts.

Under IFRS: As per IAS 37 "Provisions, contingent liabilities and contingent assets", if an entity has a contract that is onerous, the present obligation under the contract shall be recognized and measured as a provision. An onerous contract is a contract in which the unavoidable costs of meeting the obligations under the contract exceed the economic benefits expected to be received under it. The unavoidable costs under a contract reflect the least net cost of exiting from the contract, which is the lower of the cost of fulfilling it and any compensation or penalties arising from failure to fulfill it.

Considering this difference, the Corporation has reviewed its existing contracts at the transition date to identify onerous contracts. This resulted in the recognition of a provision for onerous contracts as at April 26, 2010. This provision is recognized to earnings, reversed as the contracts progress and entirely reversed as at April 24, 2011. This has led to a decrease in Operating, selling, administrative and general expenses of fiscal 2011 following the amortization of the provision.

d) Employee future benefits

i) Actuarial gains and losses

Under Canadian GAAP: Under CICA Handbook Section 3461 "Employee future benefits", for a defined benefit plan, an entity had to use the "corridor" approach and recognize amortization of actuarial gains and losses in a period in which, as of the beginning of the period, the unamortized net actuarial gain or loss exceeded 10% of the greater of:

	a)	the accrued benefit obligation at the beginning of the year; and
	b)	the fair value, or market-related value, of plan assets at the beginning of the year.

Under IFRS: As per IAS 19 "Employee benefits", an entity may choose to use the corridor approach involving the non-recognition of a portion of the actuarial gains or losses, or elect to recognize actuarial gains or losses directly to equity.

The Corporation has decided to retain its current accounting method, the corridor approach. This decision has no impact on the opening balances of the balance sheet at the transition date. However, using IFRS 1, a first-time adopter may elect to recognize all cumulative actuarial gains and losses at the date of transition to IFRS, even if the corridor approach is used for later actuarial gains and losses. Therefore, the Corporation elected to reverse unamortized actuarial gains and losses to retained earnings on April 26, 2010. The amortization amount of the actuarial losses for fiscal 2011 was calculated considering the IFRS adjusted balances and the amortization amount recognized to earnings under Canadian GAAP was reversed.

ii) Past service costs

Under Canadian GAAP: Under CICA Handbook Section 3461 "Employee future benefits", an entity amortized past service costs arising from a plan initiation or amendment by assigning an equal amount to each remaining service period up to the full eligibility date of each employee active at the date of the plan initiation or amendment who was not yet fully eligible for benefits at that date.

Under IFRS: As per IAS 19 "Employee benefits", an entity shall recognise past service costs as an expense on a straight-line basis over the average period until the benefits become vested.

Considering this difference, the Corporation reversed fully vested unamortized past service costs to retained earnings on April 26, 2010. The amortization amount of the past service costs for fiscal 2011 was calculated considering the IFRS adjusted balances and the amortization amount recognized to earnings under Canadian GAAP was reversed.

e) Stock-based compensation

Under Canadian GAAP: CICA Handbook Section 3870 "Stock-based compensation and other stock-based payments" stated that, when stock-based awards granted vest gradually, it was possible to recognize the compensation cost using the straight-line method when a method different than the gradual vesting method was used in calculating the fair value. As the Corporation was not anticipating any significant difference between the expected lives of each group of options, the straight-line method was previously used.

Under IFRS: IFRS 2 "Share-based payment", does not provide such an exception. Thus, when options granted vest gradually, an entity must consider each portion as a distinct grant and amortize the corresponding expense distinctly for each portion.

Considering this difference, the Corporation modified its expense amortization model related to stock option vesting to consider the different dates of rights acquisition and stopped using the straight-line method. The total cumulative additional expense that should have been recorded from the inception of the plans as at April 26, 2010 based on IFRS was recorded to retained earnings. The expense recognized to earnings in 2011 under Canadian GAAP has been adjusted to reflect the difference between the two amortization methods.

f) Joint Venture

Under Canadian GAAP: CICA Handbook Section 3055 "Interests in Joint Ventures" required the proportionate consolidation method. It did not allow the use of the equity method to account for investments in joint ventures.

Under IFRS: IAS 31 "Interests in Joint Ventures" offers the possibility of applying either the equity method or the proportionate consolidation method to investments in joint ventures.

Considering this difference, the Corporation opted to record its investment in RDK using the equity method at the IFRS transition date. Since the Corporation was using the proportionate consolidation method under Canadian GAAP to recognize its RDK investment, 50.01% of the values of all of the joint venture's accounts were included in the consolidated balance sheet and consolidated statement of earnings. These amounts have been removed through the reconciliation with IFRS. The value of the investment in the joint venture was recorded on the balance sheet under the item Investment in a joint venture and the Corporation's proportionate interest of RDK's income for fiscal 2011 was presented in the consolidated statement of earnings under Share of earnings of a joint venture accounted for using the equity method.

g) Business combinations

Under Canadian GAAP: As per previous CICA Handbook Section 1581 "Business Combinations" (section applicable before the IFRS transition), direct acquisition costs were part of the acquisition cost.

Under IFRS: As per IFRS 3 "Business Combinations", direct acquisition costs are recognized to earnings when they are incurred.

Because the Corporation has decided to use the exemption in IFRS 1 which allows not restating all business combinations prior to the transition date, no restatement occurred on April 26, 2010. Business combinations that occurred during fiscal 2011 were restated to reflect this difference. As a result, direct acquisition costs that occurred during fiscal 2011 were recognized to earnings on the financial statement adjusted for IFRS.

h) Presentation differences

Some amounts have been reclassified to reflect the following classification differences:

i) Deferred income taxes:

Under Canadian GAAP: As per CICA Handbook Section 3465 "Income taxes", current income tax liabilities and current income tax assets had to be presented separately from non-current portions.

Under IFRS: As per IAS 12 "Income taxes", income tax liabilities and income tax assets should all be presented under long-term assets and liabilities.

Considering IAS 12, all deferred income taxes were reclassified to long-term on the Corporation's balance sheet.

ii) Current definition

Under Canadian GAAP: As per CICA Handbook Section 1510 "Current assets and current liabilities", current assets and liabilities included those items ordinarily realizable or payable within one year from the date of the balance sheet or within the normal operating cycle, when that was longer than a year.

Under IFRS: As per IAS 1 "Presentation of financial statements", an entity shall disclose the amount expected to be recovered or settled after more than twelve months for each asset and liability line item that combines amounts expected to be recovered or settled:

	a)	no more than twelve months after the reporting period, and
	b)	more than twelve months after the reporting period.

The definition under IFRS being more directive, this resulted in a reclassification of some long-term amounts previously presented as current on the Corporation's consolidated balance sheet.

iii) Provision presentation

Under Canadian GAAP: There was no specific indication about presentation of provisions.

Under IFRS: IAS 1 "Presentation of financial statements" states in paragraph 54 l) that, as a minimum, the balance sheet shall include some items, including provisions.

Considering this difference, the current portion of provisions has been removed from Accounts payable and accrued liabilities, and the long-term portion has been removed from Deferred credits and other liabilities on the consolidated balance sheet to be presented distinctively under Provisions.

iv) Accretion expense

Under Canadian GAAP: CICA Handbook Section 3110 "Asset retirement obligations" stated that the expense related to the passage of time had to be classified as an operating item in the income statement, not as interest expense.

Under IFRS: As per IFRIC 1 "Changes in existing decommissioning, restoration and similar liabilities", the periodic unwinding of the discount shall be recognized in earnings as a finance cost as it occurs. Also, as per IAS 37 "provisions, contingent liabilities and contingent assets", where discounting is used, the carrying amount of a provision increases in each period to reflect the passage of time. This increase is recognized as finance cost.

Considering this difference, accretion expense has been reclassified under Financial expenses on the Corporation's consolidated statement of earnings for fiscal 2011.

i) Reversal of the cumulative translation adjustments

Retrospective application of IFRS would require the Corporation to determine cumulative currency translation differences in accordance with IAS 21, ''The Effects of Changes in Foreign Exchange Rates'', from the date a subsidiary or equity method investee was formed or acquired. IFRS 1 permits cumulative translation gains and losses to be reset to zero at the transition date. The Corporation elected to reset all cumulative translation gains and losses to zero in opening retained earnings at its transition date.

Cash flow statement

The only significant adjustment to the statement of cash flows is the change of accounting method for the joint venture, from the proportionate consolidation under Canadian GAAP to the equity method under IFRS. The total cash flow amounts for each category that was previously consolidated in the cash flows statement for the joint venture and that are now excluded from the cash flows statement under IFRS for the 16 and 40-week periods ended January 30, 2011 and the 52-week period ended April 24, 2011 are as follow:

		16-week period ended January 30, 2011	40-week period ended January 30, 2011	52-week period ended April 24, 2011
Cash flows
	Operating activities	5.0	17.4	20.6
	Investing activities	(1.2)	(3.3)	(4.4)
	Financing activities	(6.8)	(9.5)	(10.7)

Raymond Paré, Vice-President and Chief Financial Officer
Tel: (450) 662-6632 ext. 4607
[email protected]

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